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MTECHTIPS:-Oil futures extend losses as supply glut worries persist

MTECHTIPS:-Oil futures extend losses as supply glut worries persist

Oil futures extended losses from the prior session on Monday, as ongoing worries over the health of the global economy fueled concerns that a global supply glut may stick around for longer than anticipated. On the ICE Futures Exchange in London, Brent oil for October delivery declined 63 cents, or 1.27%, to trade at $48.98 a barrel during European morning hours. On Friday, Brent futures tumbled $1.07, or 2.11%. London-traded Brent futures lost 44 cents, or 0.88%, last week, amid fears of a China-led global economic slowdown. Oil prices have been under heavy selling pressure in recent months amid concerns over a growing glut in world markets. Global oil production is outpacing demand following a boom in U.S. shale oil production and after a decision by the OPEC last year not to cut production. Elsewhere, crude oil for delivery in October on the New York Mercantile Exchange shed 55 cents, or 1.19%, to trade at $45.50 a barrel. Nymex oil prices dropped 70 cents, or 1.5% on Friday. Despite Friday’s losses, New York-traded oil futures rose $1.05, or 1.84%, last week, amid indications U.S. oil drillers are cutting back on production following a collapse in prices over the summer. Industry research group Baker Hughes (NYSE:BHI) said late Friday that the number of rigs drilling for oil in the U.S. decreased by 13 last week to 662, the first weekly decline in seven weeks. Meanwhile, the spread between the Brent and the WTI crude contracts stood at $3.48 a barrel, below Friday’s level of $3.56. Most Asian markets ended lower on Monday, as investors monitored wild swings in China’s equity markets.
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