SummaryLatest draft keeps key request for tougher climate targetsFoggy rules on increasing climate funding for poorer countriesSome weakening in language on fossil fuelsFinal scheduled day of COP26 talksGLASGOW, Nov 12 (Reuters) - A new draft agreement for the U.N. climate conference in Glasgow on Friday presses countries to be more ambitious in their plans to tackle global warming, while walking a fine line between the demands of developing and richer nations.While the proposal retained its core demand for nations to set tougher climate pledges next year, vulnerable countries said they needed a more ambitious deal on financial compensation, with contributions from rich countries responsible for global warming going to poorer countries facing huge costs from worsening storms, droughts and rising sea levels. read more The new draft, which attempts to ensure the world will tackle global warming fast enough to stop it becoming catastrophic, is a balancing act - trying to take in the demands of climate-vulnerable nations, the world""s biggest polluters, and nations whose economies rely on fossil fuels.Register now for FREE unlimited access to Reuters.comRegisterSome countries said the proposal would keep within reach the Paris Agreement""s aspirational target to cap global warming at 1.5 degrees Celsius (2.7 Fahrenheit) above preindustrial levels, the limit scientists say would avert its most severe impacts."If the text that is currently on the table withstands the battering that it may get - yes, we are holding on by our fingernails," Grenada""s climate minister Simon Stiell said, when asked if the latest proposal kept the 1.5C target within reach.With the summit scheduled to end on Friday, negotiators have been working around the clock to try to clinch a deal that almost 200 countries can agree to - although many delegates expect the conference to spill into the weekend.NEW PLEDGESThe COP26 conference has so far not delivered enough emissions-cutting pledges to nail down the 1.5C goal, so the draft asked countries to upgrade their climate targets in 2022.However, it couched that request in weaker language than a previous draft, and failed to offer the rolling annual review of climate pledges that some developing countries have pushed for.It said the upgrade of climate pledges should take into account "different national circumstances", a phrase likely to please some developing countries, which say the demands on them to quit fossil fuels and cut emissions should be lower than on developed economies.The document spelled out that scientists say the world must cut the carbon dioxide emissions produced mainly by burning oil, gas and coal by 45% from 2010 levels by 2030, and to net zero by 2050, to hit the 1.5C target.This would effectively set the benchmark for countries"" future climate pledges to be measured against.FINANCEClimate finance continues to be a stumbling block.Poorer countries are furious that wealthy nations have still not fulfilled a 12-year-old promise to give $100 billion per year by 2020 to help them cut emissions and adapt to the worsening impacts of climate change.The new draft expressed "deep regret" at the missed target, which rich countries now expect to meet in 2023, but did not offer a plan to make sure it arrives.It did say that, from 2025, rich countries should double the funding they currently set aside to help poor countries adapt to climate impacts - a step forward from the previous draft, which did not set a date or a baseline.The deal pledged to create a global facility to address the growing losses and damage that climate change is inflicting on countries that had little part in causing it. However, it did not specify if this would include new funding.A group of countries pushing for high climate ambition in the COP26 talks - which includes the United States and European Union - on Friday said it would seek a tougher deal on loss and damage."Loss and damage is too central for us to settle for workshops. We must strengthen action on loss and damage," said Marshall Islands climate envoy Tina Stege, a representative for the group.FOSSIL FUELSThe draft retained an explicit mention of fossil fuels, which if agreed would be a first for any U.N. climate conference.But it qualified the previous text by saying the world should pledge to phase out "unabated" coal power - the dirtiest form of power - and "inefficient" subsidies for fossil fuels in general.Arab nations, many of which are big producers of oil and gas, had objected to the wording of the earlier draft.Jennifer Morgan, executive director of Greenpeace International, said that "the key line on phasing out coal and fossil fuel subsidies has been critically weakened".But others were less concerned.Bob Ward of the Grantham Institute at the London School of Economics said that "all subsidies for fossil fuels are inefficient".And Chris Littlecott of the think tank E3G said the use of the term "unabated" would "call the bluff of the coal industry" by demanding that any power plants that were not shut down must pay for the technology to clean their emissions.Register now for FREE unlimited access to Reuters.comRegisterReporting by Kate Abnett, Elizabeth Piper, Simon Jessop, Andrea Januta; Editing by Kevin Liffey and Giles ElgoodOur Standards: The Thomson Reuters Trust Principles.