* FTSEurofirst 300 falls 0.3 pct, down over 8 pct in 7 days
* Stocks with strong exposure to Russia tumble
* Energy shares fall along with Brent crude oil
By Blaise Robinson
PARIS, Dec 16 (Reuters) - European shares fell on Tuesday, extending their recent sharp slide, as a hefty Russian interest rate hike hit stocks with exposure to the country and the relentless drop in oil prices knocked energy shares.
Shares in Austrian lender Raiffeisen Bank International , which relies heavily on Russia for profits, slid 5.3 percent to a record low, after Russia's central bank raised its key interest rate to 17 percent from 10.5 percent in an emergency move that failed to immediately halt the collapse in the rouble.
Danish brewer Carlsberg and Finnish tyre maker Nokian, which both have a strong exposure to Russia, fell 4 percent and 2.9 percent respectively.
"The fact that Russia's rate hike failed to stop the drop in the rouble is spooking investors and reviving systemic fears," said Alexandre Baradez, chief market analyst at IG France.
"Adding to that, the unstoppable fall in oil and the grim PMIs in Europe ... there's just no positive catalyst for the market in the short term, even though the situation on the medium term doesn't look that bad. Lower oil prices will boost economic growth and earnings at some point."
At 0925 GMT, the FTSEurofirst 300 index of top European shares was down 0.3 percent at 1,287.32 points, after losing as much as 1.1 percent earlier in the session.
The broader STOXX 600 was also down 0.3 percent. The index has tumbled around 8.2 percent since Dec. 5, representing a wipeout in market capitalisation of $740 billion, roughly the size of Saudi Arabia's annual GDP.
Purchasing managers' survey for the euro zone released on Tuesday showed fragile growth in the currency bloc while low oil prices are fuelling fears of deflation in the bloc.
Brent fell over $1 per barrel on Tuesday to below $60 for the first time since July, hit by data showing Chinese factory activity slowed and as stumbling emerging market currencies dented demand expectations.
BP was down 0.9 percent and Total was 0.4 percent lower.
Repsol fell 2.4 percent after the Spanish oil firm said it will launch a takeover bid for Canada's Talisman Energy worth $8.3 billion.
A sharp drop in oil prices since June has dragged down valuations for oil producers and oil services companies and sparked the biggest consolidation wave in the sector since records began in the 1970s, according to Thomson Reuters data.
Bucking the trend, Orange and Deutsche Telekom rallied on news of talks with BT to sell EE.
Orange was up 2.8 percent and Deutsche Telekom rose 1.4 percent after the two firms entered exclusive talks with BT for a potential 12.5 billion-pound ($19.6 billion) sale of EE.
BT shares were up 1.9 percent.
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up
Editing by John Stonestreet and Susan Fenton