By Keith Wallis
SINGAPORE (Reuters) - Brent crude dropped for the second straight session on Friday, dragged below $83 by worries over a stronger U.S. dollar, but likely upbeat data on U.S. nonfarm payrolls for October may lend support to oil demand, said analysts.
The dollar held near a four-year high against a basket of major currencies, with its near-term fortunes hinging on whether jobs data will add to or temper optimism about the U.S. economy's outlook.
A stronger greenback makes it more expensive for holders of other currencies to buy dollar-denominated commodities.
"The market is assessing itself ahead of non-farm payrolls. More people employed means more oil demand," said Jonathan Barratt, chief investment officer at Sydney's Ayers Alliance.
Brent had dropped 58 cents to $82.28 a barrel by 0750 GMT after falling as much as 90 cents the session before. It has fallen around 4 percent so far this week.
U.S. crude eased 25 cents to $77.66 a barrel.
"I do think we've reached an area where some people are happy for the market to trade lower, but when I look at it, it's close to its lowest," Barratt said.
Brent prices on Wednesday gained slightly and U.S. crude jumped nearly 2 percent after inventory data showed U.S. crude stocks were just a fifth of levels forecast last week.
A meeting of OPEC ministers on Nov. 27 to discuss how to react to falling oil could give a direction to oil prices, said Mark Keenan, head of commodities research at Societe Generale in Singapore.
"We have a 30-40 percent probability that there will be a cut (in output) of some kind," he added.
The Nov. 24 deadline for Iran and six world powers to reach agreement over Tehran's nuclear programme was also a key date for investors to assess the outlook for oil prices, Keenan said.
"Between now and then prices will drift around (depending upon fluctuations in) the dollar," he said.
"It's hard to know where the bottom is going to be," said Phin Ziebell, oil analyst at Melbourne's National Australia Bank.
He said there could be resistance to Brent breaking below $80 since that was close to the breakeven point for deepwater and shale oil producers.
"A cold U.S. winter would slow fracking which is potentially a brake on downward prices," Ziebell said.
Investors are also eyeing the situation in Ukraine after Russian President Vladimir Putin held talks with top security chiefs on Thursday amid accusations by pro-Russian rebels that Kiev had launched a new offensive.
Elsewhere, Libya hopes to reopen the southern El Sharara oilfield "very soon" after it resolves a conflict between local tribes following an attack by gunmen that shut the field on Wednesday, an oil official said on Thursday.
(Reporting by Keith Wallis; Editing by Joseph Radford and Biju Dwarakanath)
