* Oil prices extend losses to fifth session
* Deepening rout in Chinese stocks rattle investors
* Traders eyeing weekly U.S. crude inventory reports
(Updates prices)
By Keith Wallis
SINGAPORE, July 28 (Reuters) - Oil prices fell towards
four-month lows on Tuesday, dropping for a fifth straight
session on persistent worries about a global supply glut, while
stock market sell-offs on both sides of the Pacific also rattled
investor sentiment.
Earlier in the day, Asian stocks fell to three-week lows,
with a deepening rout in Chinese stocks heightening fears about
the financial stability of the world's second biggest economy
and top energy consumer. ID:nL3N10801K MKTS/GLOB
Uncertainty over the health of the Chinese economy,
reflected in the sell-off in the stocks, lacklustre U.S. oil
demand and increasing oil supplies all added to investors'
negativity about oil prices, said Jonathan Barratt, chief
investment officer at Sydney's Ayers Alliance
"Technical levels continue to break. It's a trend which says
investors are selling," Barratt said. "It's all about sentiment
- it's a one-way traffic."
Brent LCOc1 dropped 47 cents to $53 as of 0645 GMT, after
a 2 percent drop in the previous session. It dipped to $52.88
earlier, near a four-month low of $52.83 reached on Monday.
U.S. crude CLc1 dropped 24 cents to $47.15 a barrel after
ending the previous session down 75 cents. It fell below $47
post-settlement, the lowest since March 24.
The bearish sentiment will continue, testing technical
support levels, although oil prices are expected to end 2015
higher than at current levels, according to a note from Phillip
Futures on Tuesday.
"For today, we believe the next support for WTI and Brent to
be at $46.73 and $52.40. Provided the bearish trend continues,
lower supports of $45.90 and $50 could be tested," it added.
Investors are now eyeing weekly data on U.S. inventory
levels for further trading cues.
U.S. commercial crude oil stocks likely slipped last week
after crossing the five-year seasonal average build in the
previous week, a preliminary Reuters poll of analysts showed
ahead of industry and official weekly reports. ID:nL3N1075ES
Crude stocks fell about 300,000 barrels to 463.6 million
barrels in the week ended July 24, analysts estimated.
"We're not seeing the level of demand in the U.S. one
usually expects related to the summer drive-time," Barratt said.
"The world is awash with oil," he added.
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For a 24-hr chart analysis on Brent:
http://graphics.thomsonreuters.com/US/2/PVB_20152807090104.png
For a 24-hr chart analysis on U.S. oil:
http://graphics.thomsonreuters.com/US/2/PVB_20152807082302.png
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(Editing by Alan Raybould and Himani Sarkar)