Reuters - Brent crude fell below $109 a barrel on Tuesday as investors weighed tension between Russia and Ukraine and the prospect of a gradual recovery in Libyan oil exports.

The North Sea benchmark rose to a six-week high in the previous session after Western powers agreed to expand sanctions against Russia over its actions in Ukraine. Pro-Russian separatists have ignored an ultimatum to leave occupied government buildings in eastern Ukraine.

Limiting gains, however, is the possibility of a gradual reopening of several Libyan oil ports that had been blockaded by protesting rebel groups since July.

Brent crude fell 36 cents to $108.71 by 0900 GMT after rising almost $2 on Monday. U.S. oil dropped 96 cents to $103.09, pressured by expectations of a rise in U.S. crude inventories.

"Libya will have the biggest impact going forward. The global balance will look relatively tight for the third quarter if we don't have oil from Libya," said Olivier Jakob of Petromatrix. "The Ukraine crisis is having a marginal impact."

In a tense phone call, U.S. President Barack Obama told Russian President Vladimir Putin that Moscow would face further costs for its actions in Ukraine and should use its influence to get separatists in the country to stand down.

Obama also told Putin that Moscow's actions in Ukraine were not conducive to a diplomatic solution.

The European Union agreed on Monday to expand a list of people to target with sanctions for their suspected role in violating Ukraine's territorial integrity. The EU could also hold an emergency summit next week to adopt further measures.

The Ukraine crisis, and in particular the annexation of Crimea by Russia last month, have led to the most strained relations between Moscow and the West since the Cold War and has supported oil, even with expectations of more supplies and rising inventories.

Investors are also looking to the release of key data including Chinese economic growth figures on Wednesday and weekly U.S. oil inventory numbers.

U.S. crude stocks are likely to have risen by 1.8 million barrels in the week ended April 11, a preliminary Reuters poll showed ahead of inventory reports due later on Tuesday and Wednesday.