(Reuters) - Brent crude futures fell toward $111 a barrel on Tuesday as Greece's political and economic turmoil deepened and worries that the debt-laden country could leave the euro zone sparked a sell-off in dollar-denominated commodities.

Brent prices slid for a fourth consecutive day, hammered also by fears of a slowdown in the global economy, with European data due on Tuesday expected to show the region slipping back into a second recession in just three years.

China's decision to loosen monetary policy over the weekend also fed fears that the global economy is suffering as the crisis worsens, causing investors to flee from riskier assets and weighing on copper, gold and the euro.

Brent crude slipped 40 cents to $111.17 a barrel by 02:43 a.m. EDT (0643 GMT) after sliding to $110.04 on Monday, its lowest intraday price since January 25.

U.S. crude dropped 40 cents to $94.38 a barrel, after falling to $93.65 on Monday, the weakest intraday price since December 19.

The risk-off turn in the market over the last week is due to a re-evaluation of global growth, particularly in China and Europe, which has been weighing on the market, said Natalie Robertson, an analyst at ANZ.

With the U.S. dollar showing strength, it's weighing on the commodity markets with investors moving into traditional safe-haven assets, so it's not looking good for oil.

The euro fell to a four-month low against the dollar on Tuesday, adding to the strength of the dollar index .DXY. A stronger U.S. currency can pressure dollar-denominated commodities by making them more expensive for consumers using other currencies.

Strong production in Germany could not make up for a slump across the rest of the euro zone in March, with output at factories falling and signaling an oncoming recession may not be as mild as policymakers hope.

Greek party leaders are expected to convene at 07:00 a.m. EDT (1100 GMT) on Tuesday, but there is little hope President Karolos Papoulias's proposal to form a technocrat government would end the stalemate, making a new election the most likely outcome.

Many market players think a fresh election will make it more likely for Athens to ditch its bailout pledges and hence the euro, even though euro zone finance ministers dismissed talk of Greece's exit as propaganda and nonsense.

China's Commerce Ministry said on Tuesday the country's foreign direct investment inflows dropped 2.4 percent in the first four months of this year from last year, the longest period of declining inflows since the depths of the global financial crisis.

FDI is an important gauge of the health of external economy, to which China's vast factory sector is oriented.

China's central bank had cut the bank's reserve requirement on Saturday in an attempt to loosen lending and head-off the risk of a sudden slowdown in the world's second-largest economy.


Further weighing on the oil demand outlook, U.S. crude inventories were expected to have risen for an eighth straight time last week, a Reuters analyst survey on Monday showed. Distillate stocks were seen unchanged and gasoline stocks slightly higher.

Some support for U.S. oil could be seen in the near future when the summer driving season starts in May, likely pushing up fuel demand, said Robertson.

If Europe gets its act together then crude oil prices might be supported, but there's still a lot of uncertainty and risk from Europe. Prices will likely fall further before stabilizing in the second half.

Investors will also look toward Tuesday's meeting by U.S. regulators crafting the final language of the Volcker rule and are expected to discuss how JPMorgan's $2 billion trading loss may impact their work.

The rule bans banks from making speculative bets with firm money, but includes an exemption for trades done to hedge risk.

U.S. President Barack Obama said the trading loss at JPMorgan Chase & Co (JPM.N) illustrated the need for Wall Street reform and warned that the same kind of error at a less stable bank may have required government intervention.

With Saudi producers pumping enough oil to deal with the impact of the sanctions on the oil market, the Brent market was slightly more bearish, analysts said.

Saudi Arabia wants a Brent price of around $100 a barrel and would like to see global inventories rise before demand picks up in the second half of the year, the kingdom's Oil Minister Ali al-Naimi said on Sunday.

(Editing by Ed Davies and Michael Perry)