* Front-month Brent heads for weekly drop of 3.7 percent
* Correlation between oil prices and euro remains high
* Greek crisis keeps lid on commodities, equities markets
By Alejandro Barbajosa
SINGAPORE, June 17 (Reuters) - Oil was steady on Friday as investors took their cue from currency markets, assessing the impact of the Greek debt crisis on risk aversion, which has taken almost 4 percent off Brent crude prices this week, in the biggest drop since early May.
The euro was steady, but markets were still unconvinced that Greece could dodge a default even after appearing to secure a round of near-term funding.
Brent crude for August
U.S. data over the week showed the economy of the world's top oil consumer continued to sputter in the second quarter, but also offered evidence the recovery was on course to regain momentum as the year progresses.
"Demand is not so bad and is steadily increasing in the developing countries and supply will tighthen in the second half of the year, but everyone is fearful about the euro financial crisis, especially in Greece," said Ken Hasegawa, a commodity derivatives manager at Japan's Newedge brokerage.
The International Energy Agency on Thursday raised the pressure on OPEC to increase output by forecasting a steep rise in oil demand later this year and predicting the strain on supply would last over the medium term.
The Paris-based IEA raised its assessment of how much OPEC oil would be needed this year by 400,000 barrels per day (bpd) to 30.1 million bpd in a monthly report.
U.S. Mid-Atlantic factory activity contracted in June to a near two-year low, overshadowing better than expected readings on the nation's labor and housing markets.
BRENT VS WTI
Brent's premium to U.S. crude slipped to $19 a barrel on Thursday, after hitting a record $23.34 on Wednesday, when the July contract expired.
Crude trading volumes for both contracts were on track to finish well below or just in the vicinity of 30-day averages.
Oil prices will stay above $100 a barrel in the next year as supply worries outweigh concerns about flagging global economic growth, a Reuters survey of oil industry officials, executives and traders showed.
Eight of 20 participants in the Reuters Energy and Climate Summit said they saw oil trading between $110 and $130 a barrel in June 2012, eight saw prices between $90 and $100 and three saw prices above $130. Only one respondent saw prices between $70 and $90 per barrel.
A failure by the Organization of Petroleum Exporting Countries (OPEC) to boost output last week, despite calls from the West to help protect economic growth, has fueled debate over whether OPEC and leading member Saudi Arabia have enough spare capacity to open the taps if demand rises and prices spike.
(Editing by Clarence Fernandez)