Investing.com - Crude oil prices declined 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 December delivery shed 59 cents, or 1.2%, to trade at $48.97 a barrel during U.S. morning hours.
A pair of disappointing manufacturing reports underlined concerns over the health of China's economy.
The final Caixin manufacturing purchasing managers’ index for October released earlier rose to 48.3 from September's six-and-a-half year low of 47.2.
Despite the modest uptick, activity still contracted for the eighth straight month, fueling fears the economy may still be losing momentum despite a raft of stimulus measures in recent months.
Meanwhile, the official manufacturing purchasing managers' index published Sunday held steady at 49.8 in October, the weakest level since August 2012. Analysts had expected the index to inch up to 50.0 last month.
A reading below 50.0 indicates industry contraction. Manufacturing numbers are often used as indicators for fuel demand growth.
The Asian nation is the world’s second largest oil consumer after the U.S. and has been the engine of strengthening demand.
Elsewhere, crude oil for delivery in December on the New York Mercantile Exchange dipped 60 cents, or 1.3%, to trade at $45.99 a barrel.
New York-traded oil futures surged $1.85, or 4.46%, last week, amid indications U.S. oil drillers are cutting back on production following a collapse in prices over the summer.
According to industry research group Baker Hughes (N:BHI), the number of rigs drilling for oil in the U.S. decreased by 16 last week to 578, the ninth straight weekly decline and the lowest level since June 2010.
Over the prior nine weeks, drillers in the U.S. have cut 97 rigs. A lower U.S. rig count is usually a bullish sign for oil as it signals potentially lower production in the future.
However, U.S. oil production has held around 9.0 million barrels a day, close to the highest level since the early 1970's. Meanwhile, total U.S. crude oil inventories stood near levels not seen for this time of year in at least the last 80 years.
Global oil production is outpacing demand following a boom in U.S. shale oil production and after a decision by the Organization of Petroleum Exporting Countries last year not to cut production.
Despite this tighter outlook for North America, output remains robust in other countries. Saudi Arabia and other Gulf OPEC members have indicated they will continue to stick to their policy of defending market share by keeping production high.
Meanwhile, the spread between the Brent and the WTI crude contracts stood at $2.98 a barrel, compared to $2.97 by close of trade on Friday.