By Christopher Johnson
LONDON (Reuters) - Oil steadied on Tuesday after one of its biggest selloffs this year but looked vulnerable to more falls after China's stock market took another tumble and Greece moved closer to leaving the euro zone.
Investors kept a close eye on talks in Vienna over Tehran's nuclear programme that could lead to increased exports of Iranian crude at a time of global oversupply.
Brent crude for August was unchanged at $56.54 a barrel by 1345 GMT, following a more than 6 percent drop in the previous session. On Monday, Brent briefly touched $56.38, its lowest since April 10.
U.S. crude fell as low as $51.89, down 64 cents from its close on Monday and its lowest since mid-April.
Analysts said more oil price falls could be coming.
"After yesterday's sharp and fierce selloff it is impossible to paint an even remotely bullish technical picture," said Tamas Varga, analyst at brokerage PVM Oil Associates.
"The downtrend should resume shortly."
Influential U.S. investment bank Goldman Sachs said the fall in oil prices was a consequence of oil market oversupply.
"While last week's decline in oil prices coincided with the escalation of the Greek crisis and weakness in other macro markets, the catalysts for crude's $6 a barrel move lower have little to do with Greece in our view."
"Instead, last week's oil data pointed to a still oversupplied market: a surge in OPEC production, a rise in the U.S. oil rig count and weakening refining margins," it added.
The global oil glut could deepen if major powers and Iran reach a nuclear compromise that could end sanctions against Tehran and open up exports of crude.
Nuclear negotiators in Vienna said they would keep talking beyond a self-imposed deadline for a deal on Tuesday because several key areas of disagreement remained unresolved.
But traders and analysts expected a deal to be done soon.
"We hear an Iran nuclear deal may be about to be announced, and that is bearish if it means early sanctions relief and more Iranian oil sooner rather than later," said Olivier Jacob, energy markets analyst at Swiss consultancy Petromatrix.
The outlook for oil demand looks grim as Greece struggles to remain in the euro and China faces a stock market selloff.
Chinese equity markets have fallen 30 percent since June, prompting the government to resort to a series of support measures to stabilise shares. The measures have so far had limited effect.
(Additional reporting by Henning Gloystein in Singapore; Editing by Dale Hudson and William Hardy)
