* U.S. crude up 3 pct and Brent gains 1 pct in May
* Ukraine says it sent Russia partial payment for gas
* Speculators raise net long positions by 29,291 -CFTC
* U.S. consumer spending dips, inflation up (Updates with settlement prices, adds analyst commentary, CFTC data)
By Elizabeth Dilts
NEW YORK, May 30 (Reuters) - U.S. crude fell on Friday as traders took profit at the end of the month, although the American benchmark rose 3 percent in May, underpinned by supply worries and strong gasoline demand in the United States.
Brent crude also fell Friday, but rose 1.2 percent over the month as the European benchmark traded across a $107-$111 per barrel range, supported to the high side by energy supply concerns amid ongoing fighting in eastern Ukraine where the defense minister vowed to restore "normal life."
Ukraine said it sent Russia a $786-million-partial payment for back natural gas bills thereby averting an immediate threat that Russia would stop supplying gas to Ukraine if it failed to pay and clearing the way for further talks on Monday.
Brent settled 56 cents down at $109.41 a barrel.
U.S. light crude oil retraced its losses having fallen by $1.18 to an intra-session low of $102.40 to settle 87 cents lower at $102.71 a barrel. Trading in May ranged between $105 and $99.
"It's range bound trading with the end of the month adding a little volatility," said Tariq Zahir, analyst at Tyche Capital Advisors in New York. "I think we'll be heading to the lower end of the range, to about $99. The Ukraine situation has not been anything that worried people for the last few weeks."
The speculator group raised their net long U.S. crude futures and options positions by 29,291 contracts in the week to May 27, the U.S. Commodity Futures Trading Commission said.
Oil supply from Libya, a source of high quality, light crude, remained near a tenth of capacity with protests and violence disrupting output.
U.S. consumer spending fell for the first time in a year in April but the decline, which followed two months of solid gains, did not change expectations for a sharp rebound in economic growth this quarter.
U.S. crude was partly under pressure from news of an overall rise in U.S. crude stocks, though other inventory figures were supportive.
Gasoline stocks fell 1.8 million barrels, data from the U.S. Energy Information Administration showed Thursday, compared with expectations of a 300,000-barrel gain, indicating a strong start to the U.S. summer driving season. (Additional reporting by Christopher Johnson in London and Manash Goswami in Singapore; Editing by William Hardy, Susan Thomas and Marguerita Choy)