* Chinese stocks fall 8 pct on Monday on growth worries
* Brent falls to four-month low of $53.33 a barrel
* Speculators cut net long positions on Brent
(Updates prices, adds impact on European equities market)
By Karolin Schaps
LONDON, July 27 (Reuters) - Oil hit four-month lows on
Monday after a steep drop in Chinese stock markets spread
concerns about the economic health of the world's biggest energy
consumer and more evidence emerged of a global supply glut.
Chinese stocks tumbled more than 8 percent on Monday, the
biggest one-day drop in eight years which later in the day led
European equities markets to a two-week low.
ID:nL3N1072VY ID:nL5N107245
"Today's oil price fall has been driven by the slump in
Chinese stock markets," said Carsten Fritsch, senior oil market
analyst at Commerzbank (XETRA:CBKG) in Frankfurt.
Front-month Brent crude LCOc1 fell to an intraday low of
$53.33 a barrel, its lowest in more than four months and down
$1.29 on the previous close.
It last traded at $53.65, down 97 cents, at 1430 GMT. On
Friday, Brent closed at $54.62, its lowest finish since March
19.
U.S. crude for September CLc1 was down 96 cents at $47.68
a barrel.
China is the world's biggest energy consumer. Investors
worry that a stock market crash could destabilise the Chinese
economy and cut fuel demand.
Global oil supplies are ample, with major oil producers in
the Middle East Gulf competing for market share and pumping 2-3
percent more oil than needed, analysts say.
Oil market speculators have also cut their bets on a
longer-term rise in oil prices, InterContinental Exchange data
showed. Hedge funds and money managers cut their net long
positions on Brent futures for the first time in four weeks in
the week to July 21. ID:nL5N1072AJ
In a further sign of good supply, weekly U.S. drilling rig
data showed on Friday that 21 oil rigs had been added, the
highest gain since April 2014. ID:nL1N1041JT
In Iraq, exports from its southern oilfields are on course
for a monthly record, having topped 3 million barrels per day so
far this month. ID:nL5N10420C
"In the next couple of months, even if the global oversupply
and seasonal weakness are becoming priced in, it is difficult to
see where any price uplift will come from," said Societe
Generale oil analyst Michael Wittner.
Investors were also looking to the U.S. Federal Reserve for
direction this week. The central bank on Tuesday starts a
two-day policy meeting, which could result in a September
interest rate increase that would strengthen the dollar.
"There is scope for the dollar bulls to be disappointed this
week (which) might be a driver for oil prices and the
commodities complex overall," said Ben Le Brun, market analyst
at Sydney's OptionsXpress.
A weaker dollar makes dollar-denominated commodities,
including oil, cheaper for consumers using other currencies.