FTSE falls to 3-month low on Greek debt concerns, easyJet skids

* Blue-chip FTSE 100 index falls 0.8 pct

* Greek debt jitters hurt sentiment

* easyJet slips after RBC (Other OTC: RBCI - news) downgrade, MERS worries (Adds Standard Chartered, MERS, updates prices)

By Liisa Tuhkanen and Atul Prakash

LONDON, June 15 (Reuters) - Britain's top share index slipped to trade at three-month lows on Monday, in line with a broad sell-off in European equities, after Greece failed again to reach a deal with its creditors and moved closer to defaulting on its debts.

The blue-chip FTSE 100 index was down 0.8 percent at 6,733.80 points by 1111 GMT, extending the previous session's losses of 0.9 percent.

It has lost 5 percent in two weeks, also on the prospect that the U.S. Federal Reserve could begin a cycle of rate hikes from as early as September, but is still up 2.5 percent for the year.

Julia Kloeckner, a senior official in German Chancellor Angela Merkel's conservative Christian Democrats, said Greece was gambling too far and the patience of its creditors was running out.

"Are we approaching the end-game? It looks highly likely this time around. Greece has been a handy reason to clear out of stocks over the past few weeks, with Fed-related jumpiness also playing its part," IG (LSE: IGG.L - news) analyst Chris Beauchamp said.

Talks on ending a deadlock between Greece and its creditors broke up in failure on Sunday, with European leaders venting their frustration as Athens stumbled closer towards a debt default that threatens its future in the euro.

European Union officials blamed the collapse on Athens, saying it had failed to offer anything new to secure the funding it needs to repay 1.6 billion euros ($1.8 billion) to the International Monetary Fund by the end of this month.

Among individual sharp movers, easyJet fell 2.2 percent after RBC cut its stance on the stock to "underperform" from "outperform".

"Our positive outlook for easyJet's summer has proved incorrect ... As summer is key, we see few positive catalysts until mid-2016 while easyJet faces a winter squeeze," RBC analysts said in a note.

Also denting the sentiment around the budget airline and its peers were reports of new cases of Middle East Respiratory Syndrome (MERS), which could sap enthusiasm for travel. South Korea's health ministry reported five new cases of MERS on Monday, taking the total to 150.

Standard Chartered (HKSE: 2888.HK - news) dropped 2.9 percent, the top decliner in the FTSE 100 index, after Jefferies cut its target price to 656 pence from 722 pence.

Outside the blue chips, Dragon Oil (LSE: DGO.L - news) rose 8.8 percent after the Turkmenistan-focused oil explorer said it had agreed improved takeover terms with Emirates National Oil Co (ENOC), which increased its offer to buy out the minority shareholders. Dragon Oil said ENOC had increased its offer to 750 pence in cash per share, valuing the business at around 3.7 billion pounds. (Editing by Toby Chopra)