Investing.com - Crude oil futures declined on Monday, as ongoing concerns over the health of the global economy underlined worries over a global supply glut.
Trade volumes were expected to remain light on Monday, with U.S. markets closed for the Labor Day holiday.
On the ICE Futures Exchange in London, Brent oil for October delivery slumped 89 cents, or 1.8%, to trade at $48.72 a barrel during U.S. 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 80 cents, or 1.74%, to trade at $45.25 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 $3.47 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.
The Shanghai Composite, which reopened after a four-day extended weekend, took investors on a roller coaster ride, rising almost 2% after the open, only to turn negative after the midday break to end down 2.5%.
China's National Bureau of Statistics revised down the 2014 GDP growth rate to 7.3% from the previously announced 7.4% on Monday. For this year, China has set a growth target of about 7%, the slowest pace in 25 years.
A modest rebound in European equity markets helped soothe investors' tattered nerves. U.S. markets will be closed on Monday for the Labor Day holiday.
Mixed U.S. payrolls data on Friday failed to quell uncertainty over the prospect of a near-term interest rate hike from the Federal Reserve.
The Labor Department reported that the U.S. economy added 173,000 jobs last month, below forecasts for an increase of 220,000 and slowing from gains of 245,000 a month earlier.
But the unemployment rate ticked down to 5.1%, its lowest level since April 2008 from 5.3% in July, while average hourly wages rose by a stronger-than-expected 2.2%.
The jobs report failed to provide much clarity on when the Federal Reserve will decide to raise short term interest rates. The timing of a Fed rate hike has been a constant source of debate in the markets in recent months.