By Daniel Wallis

NAIROBI, Jan 1 (Reuters) - Nairobi residents celebrated a subdued New Year Eve as violence over Kenya's disputed presidential poll meant nightlife all but ground to a halt and left the capital's streets nearly deserted.

Most city dwellers stayed home as supporters of opposition challenger Raila Odinga and President Mwai Kibaki clashed with police, gunshots cracked and smoke billowed over burning slums.

Most businesses stayed locked for fear of looters, so those who did venture out for provisions were often disappointed. Long lines formed early at cash machines and the few open shops.

"Many of us who laughed at Kenyan colleagues stockpiling food and water before the election feel a bit silly now," said one Briton working with the United Nations, which has more than 3,000 staff at a major complex in Nairobi's northern suburbs.

Bread, milk and other basic supplies were absent from the shelves of most of the supermarkets that did open their doors. But the government said no one should be alarmed.

"There is no reason for any person to feel they need to stock up with food because shops and businesses will continue to be open as usual," it said in a statement.

But that did little to quell the anxiety.

"The bank machines have all run out around here, so now they are accepting dollars in here," said Elizabeth Wolf, who was visiting from Ireland for Christmas and queuing to buy food.

"The situation is terrible."

Finally reaching the cash register at a 24-hour petrol station on the other side of city, elderly Bernard Ngari put down three bottles of beer. Then, shrugging apologies to those behind him, he returned to the refrigerator for a fourth. "We have to celebrate New Year somehow," he said. "These politicians are just mad. They are crazy for power."

As dark fell, normally lively nightspots stood dark and silent as police toting guns patrolled the city centre.

At one Ethiopian restaurant that did stay open into the early hours, two dozen revellers ate and drank and at midnight stood together to sing the Kenyan national anthem.

"Tonight we are all Kenyans together," said one man, toasting the room with a glass of wine. But the party broke up relatively early, and all they drove off into the quiet streets. (Additional reporting by Wangui Kanina; Editing by Catherine Evans)

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