TOKYO, May 21 (Reuters) - Oil prices fell in early Asian trade on Tuesday, with investors anticipating higher-for-longer U.S. inflation and interest rates will depress consumer and industrial demand.

Brent crude futures declined 12 cents, or 0.1%, to $83.34 a barrel by 0041 GMT. U.S. West Texas Intermediate crude (WTI) eased 8 cents, or 0.1%, to $79.72 a barrel.

Both benchmarks fell less than 1% on Monday as U.S. Federal Reserve officials said they were awaiting more signs of slowing inflation before considering interest rate cuts.

"Fears of weaker demand led to selling as the prospect of Fed rate cut became more distant," said analyst Toshitaka Tazawa at Fujitomi Securities.

Fed Vice Chair Philip Jefferson said on Monday it was too early to tell if the inflation slowdown is "long lasting," while Vice Chair Michael Barr said restrictive policy needs more time. Atlanta Fed President Raphael Bostic said it will "take a while" for the central bank to be confident that price growth slowdown is sustainable.

Lower interest rates reduce borrowing costs, freeing up funds which could boost economic growth and demand for oil.

Global physical crude oil markets are weakening because of soft refinery demand and ample supply, traders and analysts told Reuters, which could spell further weakness for benchmark crude futures.

On the other hand, the market appeared little affected by political uncertainty in two major oil-producing countries.

Iranian President Ebrahim Raisi, a hardliner and potential successor to Supreme Leader Ayatollah Ali Khamenei, was killed in a helicopter crash, while Saudi Arabia's Crown Prince Mohammed Bin Salman deferred a trip to Japan because of the health of his father, the king.

"The death of the Iranian President and the Saudi king's health issue don't seem to be affecting the market much, as it is unclear whether they will have an immediate impact on energy policy," Fujitomi's Tazawa said.

Investors are focusing on supply from the Organization of the Petroleum Exporting Countries and its affiliates, together known as OPEC+. They are scheduled to meet on June 1 to set output policy, including whether to extend some members' 2.2 million barrels per day of voluntary cuts.

OPEC+ could extend some voluntary output cuts if demand fails to pick up, people with knowledge of the matter previously told Reuters. (Reporting by Yuka Obayashi; Editing by Christopher Cushing)