UPDATE 10-Oil slides on U.S. response to Syria, but up for week
* Secretary of state confirms US intends "limited" strike
* Unrest in Libya cripples crude output, exports
* British Parliament votes against Syria attack (Adds CFTC commitment of traders data)
By Anna Louie Sussman
NEW YORK, Aug 30 (Reuters) - Brent crude oil fell in volatile trade on Friday ahead of a long holiday weekend in the United States, as the Obama administration made a case for a "limited" strike against Syria.
For the week, Brent and U.S. crude both posted gains, and Brent's monthly rise in August was its biggest such gain in a year.
On Friday afternoon, oil prices fell, rebounded, then fell again as traders watched U.S. Secretary of State John Kerry's televised address for signs of what the administration might do.
During his address, Kerry released evidence that the Syrian government had used chemical weapons against civilians multiple times in the past year and said the "indiscriminate, inconceivable horror" could not go unpunished.
After Kerry spoke, President Barack Obama said the United States was still planning its response, one that would not involve an open-ended commitment or major military operation in Syria.
Oil prices had surged early this week as investors worried the crisis in Syria could spill over into other nations in the Middle East and disrupting oil supplies, especially if the United States conducted a large strike.
"It's clear there's going to be a military strike of some kind, but it became clear that it's going to be limited in scope and that's why we sold off," said John Kilduff, partner at Again Capital LLC.
Brent crude for October fell $1.15 to settle at $114.01 a barrel, after earlier reaching a low of $113.63 prior to Kerry's speech. Brent gained 2.7 percent over the past week.
U.S. crude for October delivery fell $1.15 to settle at $107.65 a barrel after hitting a session low of $106.75. U.S. crude finished the week up 1.2 percent.
U.S. refined products, which expire today, led the decline, with contracts for gasoline and heating oil down more than 1.3 percent.
Traders said some selling on Friday was linked to the long Labor Day weekend in the United States, with investors looking to close out positions ahead of the three-day weekend.
Money managers raised their net long U.S. crude futures and options positions in the week to Aug. 27 for the first time in five weeks, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.
The speculator group raise its combined futures and options position in New York and London by 19,414 contracts to 361,725 during the period, the second-biggest long bet on record.
Market participants kept an eye on supply issues.
The U.S. Energy Information Administration has said global supply disruptions reached 2.7 million bpd in July, and analysts say outages have risen since then.
Libya's crude exports have shrunk to just over 10 percent of capacity from three ports, out of a possible nine, as armed groups have tightened their grip on its major industry. Maintenance in Iraq in September is also expected to cut supplies.
Increased production by Saudi Arabia and the possibility of an emergency oil stocks release by the International Energy Agency (IEA) could offset the disruption.
Supply from the Organization of the Petroleum Exporting Countries has averaged 30.32 million barrels per day (bpd), down from a revised 30.50 million bpd in July, a Reuters survey of shipping data and sources at oil companies, OPEC and consultants found.
Brent crude prices rose nearly 6 percent in August, after unrest cut output in Libya by around 1 million barrels per day (bpd) and production fell in Iraq, Nigeria and elsewhere.
Upward momentum for prices appeared to stall after Britain's Parliament defeated a proposal by Prime Minister David Cameron that could have led to UK involvement in a strike against Syria.
(Additional reporting by David Sheppard in New York, Christopher Johnson in London and Florence Tan in Singapore; editing by Andrew Hay, Marguerita Choy, John Wallace and David Gregorio)
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