(Updates prices to early afternoon)
* U.S. shares fall as oil majors slide
* Brent crude hits nearly 7-year low after OPEC meeting
* Dollar up for second day; weaker euro boosts Europe shares
By Sam Forgione
NEW YORK, Dec 7 (Reuters) - Oil prices skidded to their lowest level in nearly seven years on Monday, hurting the shares of major oil companies on Wall Street as a global glut showed no signs of abating, while European stocks benefited from a weaker euro.
Brent crude prices LCOc1 fell to $41.20, their lowest since February 2009, after a meeting of members of the Organization of the Petroleum Exporting Countries Friday ended in disagreement over production cuts and without a reference to its output ceiling. urn:newsml:reuters.com:*:nL3N13W1AN
Oil majors Exxon (N:XOM) XOM.N , down 3 percent, and Chevron (N:CVX) CVX.N , which fell 2.9 percent, were the biggest drags on the U.S. Dow and benchmark S&P 500 indexes. Increased strength in the dollar for a second straight session made it more expensive to hold crude positions.
Brent crude LCOc1 was last down $2.26, or 5.3 percent, at $40.74 a barrel, while U.S. crude CLc1 was last down $2.12, or 4.9 percent, at $40.88 per barrel. urn:newsml:reuters.com:*:nL3N13W1AN
"As a result of the collapse in oil and gas prices today, the market is worried that you're going to see less capital spending, you're losing a lot of a good-wage jobs in the oil patch, and people are worrying that we're going to see a snowball of defaults among high-yield energy issuers," said Scott Wren, senior global equity strategist at Wells Fargo (N:WFC) Investment Institute in St. Louis.
A weaker euro helped boost European shares, which rose from three-week lows hit last week when the European Central Bank disappointed investors with its latest stimulus package. A weaker euro helps stocks by making European exports cheaper relative to competing imports. urn:newsml:reuters.com:*:nL8N13W27V
An outlier among European stocks was Electrolux ELUXb.ST , which sank over 13 percent after its deal to buy General Electric's GE.N appliance business fell through. urn:newsml:reuters.com:*:nL8N13W0SX
MSCI's all-country world equity index .MIWD00000PUS , which tracks shares in 45 nations, was last down 0.7 percent.
The Dow Jones industrial average .DJI fell 0.83 percent at 17,698.75. The S&P 500 .SPX was down 0.89 percent, at 2,073.10. The Nasdaq Composite .IXIC was off 0.89 percent, at 5,096.62. urn:newsml:reuters.com:*:nL3N13W4DQ
Europe's broad FTSEurofirst 300 index .FTEU3 added 0.45 percent, and was last at 1,464.4. The euro EUR= was last down 0.32 percent, at $1.0856.
The dollar rose on expectations the U.S. Federal Reserve is on track to raise interest rates next week in the wake of a solid November jobs report. The dollar index .DXY , which tracks the greenback against a basket of six major currencies, rose 0.28 percent, to 98.62. urn:newsml:reuters.com:*:nL8N13W2QM
"It's pretty much a done deal they will move," Charles St-Arnaud, currency strategist at Nomura Securities International in New York said of the Fed, which meets on monetary policy on Dec. 15-16.
U.S. Treasury debt prices rallied as investors consolidated positions in a week that is generally thin on economic data after last Friday's stronger-than-expected U.S. November jobs report.
Benchmark 10-year Treasury notes US10YT=RR were last up 14/32 in price to yield 2.21 percent, from a yield of 2.28 percent late Friday. urn:newsml:reuters.com:*:nL1N13W0SZ
Spot gold prices XAU= fell from a three-week high and were last down $7.40, or 0.7 percent, at $1,077.1 an ounce after the gains in the dollar. urn:newsml:reuters.com:*:nL3N13W36W