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Brent crude futures for December settlement fell by as much as
1.1%, and was last down 77 cents, or 0.8%, at $97.15 a barrel by
0645 GMT.
West Texas Intermediate crude for November delivery declined by
as much as 1.1% and was last at $92 a barrel, down 64 cents, or
0.7%.
Services activity in China during September contracted for the
first time in four months as COVID-19 restrictions hit demand
and business confidence, data showed on Saturday.
The slowdown in the economy of China, the world's second-largest
oil consumer after the United States, adds to growing concerns
about a possible global recession triggered by numerous central
banks raising interest rates to combat high inflation rates.
"Oil ... is getting hit with the triple whammy of China's
economic weakness, U.S. monetary policy tightening and Biden
administration SPR intervention," Stephen Innes, managing
director at SPI Asset Management, said in a note.
Innes was referring to the possibility of additional releases
from the U.S. Strategic Petroleum Reserve next month in response
to the decision last week by the Organization of the Petroleum
Exporting Countries and allies including Russia, known as OPEC+,
to lower their output target by 2 million barrels per day.
Brent and WTI posted their biggest weekly percentage gains since
March after the reduction was announced.
The OPEC+ cuts, which come ahead of a European Union embargo on
Russian oil, will squeeze supply in an already tight market. EU
sanctions on Russian crude and oil products will take effect in
December and February, respectively.
"The cut is clearly bullish," ING analysts said in a note.
"However, there is obviously still plenty of other uncertainty
in the market, including how Russian oil supply evolves due to
the EU oil ban and G7 price cap, as well as the demand outlook
given the deteriorating macro picture."
(Additional reporting by Florence Tan and Emily Chow; Editing by
Jacqueline Wong, Christian Schmollinger and Louise Heavens)
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