* Investors sell off oil, commodities, equities

  * U.S. crude down 13 percent in August (Recasts, updates throughout, changes dateline from previous LONDON)

  NEW YORK, Aug 18 (Reuters) - Oil fell more than $2 on Thursday as a raft of weak U.S. economic data provided a fresh blow to shaky investor confidence and extended U.S. oil's losses to 13 percent so far in August.

  Early pressure from disappointing U.S. weekly jobless claims and July home sales reports sparked a steep sell off at mid-morning, before a report showing factory activity in the U.S. Mid-Atlantic region in August dropped to the lowest level since March 2009.

  Gold hit a fresh record as investors sought safe havens and fled equities and commodities, which have been battered this month by concerns about the U.S. deficit, the euro zone debt crisis and a darkening economic outlook.

  " It's much of the same -- concerns over European banks, U.S. deficits weighing on economic growth and the possibility of a global recession as the end result," said Chris Jarvis, senior analyst for Caprock Risk Management, Hampton Falls, New Hampshire.

  " These cross currents are driving wild swings for riskier asset classes such as equities and commodities, specifically crude oil. Until clarity improves, we expect volatility to remain elevated relative to historical norms."

  Brent crude futures fell $2.35 to $108.25 a barrel by 1051 EDT (1451 GMT), down from near $117 a barrel at the end of July.

  Losses were heavier in U.S. crude, down $3.89 to $83.69 a barrel, off end-July levels near $96 a barrel. U.S. crude's discount to Brent widened to over $24 a barrel. (Reporting by Matthew Robinson, Gene Ramos, Robert Gibbons, Eileen Moustakis and Selam Gebrekiden in New York, Francis Kan in Singapore and Ikuko Kurahone in London Editing by Alden Bentley)

By Rodrigo Campos

  NEW YORK (Reuters) - U.S. stocks tumbled more than 4 percent on Thursday after data pointed to a stalled U.S. economy and as bank shares sank on a report regulators were scrutinizing the U.S. units of big European lenders.

  The decline was broad as well as steep, with just a small handful of the S& P 500's components in positive territory.

  The KBW bank index slid 5.5 percent, with Citigroup Inc off 9.6 percent at $27, and Morgan Stanley down 7.5 percent at

  $15.75.

  " The market is in meltdown mode," said Sal Catrini, managing director for equities at Cantor Fitzgerald & Co in New York. " The data continues to stink. We continue to be in a soft patch."

  The Dow Jones industrial average was down 479.53 points, or 4.20 percent, at 10,930.68. The Standard & Poor's 500 fell 52.77 points, or 4.42 percent, at 1,141.12. The Nasdaq Composite lost 120.57 points, or 4.80 percent, at 2,390.91.

  Still, at its session low, the S& P 500 was 3 percent above the year lows set early last week.

  Factory activity in the U.S. Mid-Atlantic region plummeted in August, falling to the lowest level since March 2009, while existing home sales unexpectedly dropped in July, tempering hopes for a revival of economic recovery.

  Concerned the European debt crisis might spread to U.S. banks, the Federal Reserve Bank of New York has asked for more information about whether the U.S. units of big European lenders have reliable access to funds needed to operate, the Wall Street Journal reported.

  Also denting the market, new jobless claims rose more than expected last week, while consumer prices rose faster than expected in July, separate government reports showed.

  Investors continued to worry that European policymakers were not doing enough to tackle the euro zone's debt crisis. European blue chips were down 5 percent, with banks down 5.5 percent.

NEW YORK, Aug 18 (Reuters) - The euro extended losses against the dollar and the Swiss franc on Thursday after data showed factory activity in the U.S. Mid-Atlantic region plummeted in August, falling to the lowest level since March 2009.

  The euro hit as low as $1.42866 on trading platform EBS, and was last down 0.9 percent at $1.4289.

  The euro also lost 1.3 percent to 1.1257 Swiss francs.

  The dollar dipped 0.2 percent to 76.48 yen after the data, while it hit a session low of 0.78570 Swiss franc on EBS.

  A separate report showed U.S. existing-home sales unexpectedly dropped in July. (Editing by Editing by Theodore d'Afflisio)

MANCHESTER UNITED OWNERS PLAN TO USE SINGAPORE IPO PROCEEDS TO PAY DOWN DEBT AND FURTHER GROW ASIA BUSINESS - SOURCE

(Adds details, quote, market reaction)

  NEW YORK, Aug 18 (Reuters) - A gauge of factory activity in the U.S. Mid-Atlantic region plummeted in August, falling to the lowest level since March 2009 and casting more doubts on the strength of the economic recovery, a survey showed on Thursday.

  The Philadelphia Federal Reserve Bank said its business activity index dropped to minus 30.7 from positive 3.2 the month before and was far below economists' expectations for positive 3.7, according to a Reuters poll. It missed the poll's lowest forecast for minus 10.0.

  It was the biggest month-over-month drop since October 2008, during the heart of the credit crisis.

  Any reading above zero indicates expansion in the region's manufacturing. The survey covers factories in eastern Pennsylvania, southern New Jersey and Delaware.

  It is seen as one of the first monthly indicators of the health of U.S. manufacturing leading up to the larger national report by the Institute for Supply Management.

  U.S. stocks extended losses immediately following the report, sending the S& P 500 down more than 4 percent. U.S. Treasuries prices added to gains, while the dollar extended its gains against the euro.

  New orders fell to minus 26.8 from positive 0.1. The employment components worsened, with the gauge of the number of employees falling to minus 5.2 from positive 8.9, and the average work week index dropping to minus 14.4 from minus 5.4.

  " It looks pretty bad across the board, especially with new orders," said Gus Faucher, director of macroeconomics at Moody's Analytics in West Chester, Pennsylvania.

  " It shows demand is softening. Businesses are anxious at this point."

  Survey respondents' view on the coming months also deteriorated with the gauge of business conditions for the next six months falling to 1.4 from 23.7. The index was at its lowest since November 2008.

LONDON, Aug 18 (Reuters) - The Obama administration on Thursday imposed fresh sanctions on Syria's government, freezing assets in the United States as well as banning petroleum products of Syrian origin.

  The latest round of sanctions against Syrian President Bashar al-Assad and his government prohibit U.S. entities, wherever located, from engaging in any transactions or dealings with Syrian petroleum products.

  Syria's oil production declined from 581,000 bpd in 2001 to 375,000 bpd in 2009, according to BP data, but recovered to 385,000 bpd in 2010 after new fields started up.

  The country also imports refined oil products normally via regular tenders and exports products occasionally.

  Following are the views from analysts about implications for the oil market and their views on whether the EU to would follow the United States or not.

  OLIVIER JAKOB, PETROMATRIX, ZUG, SWITZLERLAND

  " Overall, I do not think this will have a huge impact. There are sanctions on Iran and Iran is still exporting oil. Sanctions never seem to work, so I don't think it will have a big effect - its trade flows are not huge.

  " Europe has no trade ban on Iran, so will it put one on Syria? As long as it is only the United States, it will not have a great impact."

  THORBJØRN BAK JENSEN, OIL MARKET ANALYST AT A/S GLOBAL RISK MANAGEMENT LTD, COPENHAGEN

  " The EU will probably follow, but they produced less than 400,000 bpd and consume most of the crude themselves. The only impact is potentially on pipelines running through the country.

  " The case with Libya was another story altogether. With Syria the impact is mainly increasing instability in the region. In terms of oil supply it won't have any significant impact."

  HARRY TCHILINGUIRIAN, BNP PARIBAS' HEAD, COMMODITY MARKETS STRATEGY, LONDON

  " Oil for now is discarding developments in the Middle East, and continues to track equity markets amidst very weak U.S. economic data today."

 

  (Reporting by Ikuko Kurahone, Jessica Donati, Edward McAllister editing by Keiron Henderson)

(Fixes typo in headline)

  * Spot gold touches second record in a week

  * Safe-haven dollar rises as risk appetite falls

  * Global equities tumbles as growth worries rise

  * Oil slips on slow global growth, US data (Adds opening of U.S. markets, byline, dateline previous LONDON)

  By Herbert Lash

  NEW YORK, Aug 18 (Reuters) - World equity markets tumbled and gold shot to a new record high on Thursday as renewed worries about Europe's debt crisis and sour U.S. data added to fears that major economies were close to recession.

  Aversion to risk swept financial markets, with corporate bonds, industrial commodities and higher-yielding currencies sliding and assets viewed as safe-havens, such as gold, government bonds and the dollar, gaining.

  Gold rallied to its second record high in a week. Spot gold < XAU=> hit a record $1,817.90, although it is still off its inflation-adjusted peak above $2,000 struck in 1980.

  The U.S. dollar and yen firmed as global growth anxiety and worries about European banks drove investors to the relative safety of both currencies. [ID:nN1E77H0EL]

  The ICE Futures dollar index < .DXY> was up 0.7 percent at 74.197 while the euro fell 0.6 percent to $1.43348 < EUR=EBS> , tracking a more than 4 percent fall in European shares < .FTEU3> .

  " We have much lower risk appetite today and that's why we're seeing the dollar strengthen," said Ray Attrill, senior currency strategist, at BNP Paribas in New York.

  " Stocks are down across the board and that may be due to some global growth worries," Attrill said.

  U.S. stocks tumbled more than 3 percent in early trading, pulled lower by bank shares after The Wall Street Journal reported that regulators were intensifying their review of the U.S. units of European banks. [ID:nL5E7JI0Q]

  The sell-off " is rooted in the European banking system," said Jack de Gan, chief investment officer at Harbor Advisory Corp in Portsmouth, New Hampshire.

  " It reflects continued concern that sovereign debt issues indicate we're going to have to bail out all those banks again. And if there's stress in major European banks, it will affect U.S. banks too."

  Sentiment worsened as the Philadelphia Federal Reserve said factory activity in the U.S. Mid-Atlantic region plummeted in August, falling to the lowest level since March 2009. Separate government data showed the number of Americans claiming new jobless benefits rose last week.

  The Dow Jones industrial average < .DJI> was down 331.00 points, or 2.90 percent, at 11,079.21. The Standard & Poor's 500 Index < .SPX> was down 37.99 points, or 3.18 percent, at 1,155.90. The Nasdaq Composite Index < .IXIC> was down 94.26 points, or 3.75 percent, at 2,417.22.

  U.S. Treasury prices gained as fears over a global growth slowdown intensified,

  The benchmark 10-year U.S. Treasury note < US10YT=RR> was up 34/32 in price and its yield slumped to 2.05 percent.

  Crude prices tumbled on the prospect of declining demand.

  Brent < LCOc1> fell 2.5 percent to $107.82 a barrel, while U.S. light sweet crude oil < CLc1> 3.95 percent to $84.12 a barrel.

  Spot gold prices < XAU=> rose $24.30 to $1,812.40 an ounce. (Reporting by Rodrigo Campos, Gertrude Chavez-Dreyfuss and Karen Brettell in New York Anirban Nag, Atul Prakash and Ikuko Kurahone in London Writing by Herbert Lash, Editing by Chizu Nomiyama)

* Top output of 7.5 mln t/year now due in 2014, not 2018

  * Gas re-injection unit due on stream in 2013

  * Gas prospects hinge on Gazprom's plans at nearby field

 

  By Melissa Akin

  IRKUTSK, Russia, Aug 18 (Reuters)- By speeding up output growth at one of Russia's newly-tapped East Siberian oilfields the operators have given themselves a headache -- they are producing much more gas and have little choice but to flare it.

  New oil from Verkhnechonsk, launched in 2008, has helped Russia maintain modest crude output growth over the past two years and secure new markets in Asia, even as declines accelerate in the Soviet-era oil heartland of West Siberia.

  Encouraged by high oil prices and low taxes for new fields, Anglo-Russian oil company TNK-BP and its partner in Verkhnechonsk, state-controlled Rosneft , pledged extra investment to bring the field to peak output four years early.

  It is now expected to produce 7.5 million tonnes a year from 2014, instead of 2018.

  It will pump 4.9 million tonnes this year, (nearly 100,000 barrels per day), increasing to 6.5 million tonnes in 2012, Igor Rustamov, head of operator Verkhnechonskneftegaz, told reporters at its headquarters in the Siberian provincial capital Irkutsk.

  The plans for accelerated production growth were approved by regulators in Moscow this month, Rustamov said.

  But the field is also richer in so-called associated gas than other major Russian fields. And for now, the more crude oil pumped at Verkhnechonsk, the more gas has to be wastefully flared for lack of other possible uses.

  The industrial city of Irkutsk, 1,200 km (750 miles) away from Verkhnechonsk on the banks of Lake Baikal, is the nearest major urban gas market. Without a pipeline link, Verkhnechonsk can burn only some of the gas at its own two small power plants.

 

  FLARING CURBS

  Russia flared 35 billion cubic metres of gas last year, down from 52 bcm in 2007 but still more than any other country, according to World Bank estimates based on satellite surveillance.

  Gas flaring worldwide accounted for 1.2 percent of emissions of carbon dioxide, a gas responsible for global warming, according to climate-change scientists.

  Russia wants to cut flaring to just 5 percent of associated gas volumes from the end of this year. Industry officials say privately that the goal -- which has been repeatedly delayed -- will impose huge costs.

  For now, TNK-BP is pursuing what it sees as its best option, pumping the gas back underground in hope of retrieving it later.

  The planned re-injection facility -- powered by a 1 billion cubic metre (bcm) per year compressor now under construction at General Electric -- will start working at Verkhnechonsk at the end of 2013, just before the field hits peak production.

  It will also add a third, larger power station to consume more gas for its own electricity needs.

  The strategy, Rustamov said, reflects hope that the operators can eventually pump the gas out of underground reservoirs and into still-unbuilt East Siberian pipeline infrastructure for delivery to clients in Russia and abroad.

  " Just 250 km from Verkhnechonsk is Chayandinskoye, an enormous field with enormous gas reserves," said Rustamov.

  " We are coordinating our actions with Gazprom in order to get access to the infrastructure in 2019-2020."

  Gazprom, the state gas export monopoly and operator of the country's unified gas supply system, is planning to bring Chayandinskoye on stream in 2016.

  TNK-BP has already seen some success in winning access to Gazprom's pipelines. It secured a six-year access deal to ship gas from its Rospan project in Western Siberia, now pumping 2.7 bcm per year, and would like to obtain a 10-12 year deal.

  The No.3 Russian oil producer is pursuing an aggressive strategy to double its natural gas output to 30 billion cubic metres per year by 2020, betting that independent producers will fill more space in Gazprom's pipelines in the coming years.

  But East Siberian gas is a tough proposition, in part because of the sheer distance between the region's gas riches and its most lucrative potential markets on the Pacific Rim.

  And while Gazprom says Asian buyers must compete for its East Siberian gas, it has so far failed to secure a supply deal with China -- for up to 68 bcm per year -- that could underpin the vast investments needed to bring gas to market. (Editing by Douglas Busvine and Anthony Barker)

* Morgan Stanley cuts global growth forecasts

  * Equities fall, dollar firm vs Swiss franc on talk of intervention

  * Coming Up: U.S. initial jobless claims July 30 1230 GMT (Update prices)

  By Ikuko Kurahone

  LONDON, Aug 18 (Reuters) - Brent crude fell below $109 a barrel on Thursday, dropping from its highest level in about two weeks, with worries about euro zone debt problems and a slower global growth outlook weighing on prices.

  Brent crude futures < LCOc1> fell $1.65, or 1.15 percent, to $108.95 a barrel by 1234 GMT, after hitting the highest closing price since Aug. 3 on Wednesday. U.S. crude < CLc1> led the oil complex lower, falling $2.46 or 2.8 percent to $85.12.

  " Confidence is extremely fragile," said Mark Thomas, head of Europe, energy, with brokerage Marex Financial.

  " It is only a matter of time before inherent euro conflicts come to the fore again and that will put on pressure again, apart from (on) gold."

  Gold was edging higher, while European shares fell from a high hit on Wednesday. Asian stocks were sold off.

 

  Adding to the glum growth picture, Morgan Stanley cut its forecast for global growth, citing " recent policy errors" in the United States and Europe, plus prospects of further fiscal tightening in 2012.

  The bank also said the global economy is " dangerously close to a recession" .

  Data due later in the day, including U.S. initial jobless claims, existing home sales and regional manufacturing, will be closely watched.

 

  Oil was also depressed by a stronger dollar, which rose as much as 0.4 percent against a basket of currencies on Thursday, making dollar-denominated assets more expensive when purchased in other currencies.

  The Swiss franc fell against the euro and the dollar with traders saying the Swiss National Bank was intervening in the forwards market in its bid to curb the currency's strength.

  The plight of the Swiss franc is part of a larger battle over Europe's fiscal crisis, with the Swiss currency a beneficiary of investors seeking a safe haven in a currency other than the euro.

  Still, the dollar would remain under pressure and could hit record lows against the Swiss franc in days ahead as long as the U.S. economic recovery stays tenuous, analysts said.

 

  LIBYA

  The market is also watching the situation in Libya, where rebels to the west and east of the capital fought forces loyal to Muammar Gaddafi for control of oil facilities vital to winning the six-month-old civil war.

  Oil prices have been supported by the loss of around 1.6 million barrels per day of production in Libya since the start of an uprising against Gaddafi's rule in February. (Reporting by Francis Kan in Singapore and Ikuko Kurahone in London editing by Jason Neely)