* Brent gains to as much as $116.50; U.S. oil tops $96.38
* U.S. crude stocks likely fell for a seventh week -poll
* IEA unlikely to announce emergency stock release in meeting
* Coming Up: US API oil stocks data, 2030 GMT (Adds details on China's fuel stocks, updates prices)
By Seng Li Peng
SINGAPORE, July 19 (Reuters) - Brent crude rose 15 cents to $116.20 a barrel on Tuesday, reversing the previous session's losses, as the dollar weakened and on expectations oil stocks in the world's top consumer U.S. fell for a seventh week.
Brent
The twin factors helped divert investor attention away from a sovereign debt default in the U.S. and Europe that partly led to Brent settling $1.21 a barrel lower on Monday. The weaker dollar also helped boost prices of commodities such as copper.
"The weakening dollar is pretty much all I can say" is the reason for the rise in Brent, said Benson Wang of Commodity Broking Services in Sydney.
The dollar softened versus the euro and a basket of currencies on Tuesday as the single currency regained some ground after losses in the previous session on worries that the euro zone debt crisis will worsen.
The White House said on Monday it was pursuing a last-ditch plan with Congress to raise the U.S. debt ceiling and avert a default that could plunge global financial markets into chaos.
"Eventually, the U.S. will achieve a resolution to lift the debt ceiling, which will further weaken the dollar," said Wang.
A weaker dollar makes oil and other commodities more affordable for holders of other currencies, and gold rose further after the 1 percent rise overnight.
Brent is biased to fall to $110 per barrel as a bearish double-top is likely to be confirmed, while U.S. oil will be neutral in $94.50-$97.90 per barrel, according to Reuters technical analyst Wang Tao.
IEA, OIL STOCKS
Oil was also supported by expectations that the International Energy Agency (IEA) would not release emergency stocks for the second time so soon.
This was because there was no sign yet of the kind of shortage to mandate another dip into the West's emergency oil reserves when a 30-day deadline for assessing the impact of a first release expires at the end of this week, traders and analysts said.
For another IEA release to take place, it would have to be endorsed by all 28 members of the energy consumer body. Germany and Italy are likely to resist any plans for a second release for now, a French government source told Reuters last week.
Investors were also focusing on a decline in crude stockpiles in the U.S., where inventories are likely to have fallen by 1.3 million barrels last week due to higher refinery utilization and a slide in imports, a Reuters poll showed ahead of weekly reports.
Participants were also watching China, where refined oil product stocks at the end of June increased nearly 1 million tonnes from a year earlier and were at a normal level, after fuel consumption slowed down since mid-April, a government report showed on Tuesday.
"China demand will have quite an impact on Brent as it buys a lot of Brent related crude oil. Chinese refiners usually need sweet crude from West Africa," said a North Asian trader.
EURO ZONE
Governments and banks in Europe struggled to reconcile competing proposals for a second bailout of Greece on Monday, three days before leaders meet to prevent the crisis from spreading through the region.
The euro zone summit scheduled for Thursday in Brussels is likely to agree on a rescue of Greece, supplementing a 110 billion euro ($154 billion) bailout launched in May last year, a French government spokeswoman said.
But after three weeks of preparatory talks, it was unclear how a consensus could be reached for private owners of Greek government bonds -- banks, insurers and other investors -- to contribute by taking cuts in the face value of their holdings. (Reporting by Seng Li Peng; Editing by Manash Goswami)