Following a Friday rally, oil prices dropped on Monday as fresh worries about slowing demand in China and the US soured investor mood.
U.S. West Texas Intermediate (WTI) crude futures for December were down 35 cents, or 0.5 per cent, to $76.82, while Brent crude futures for January were down 35 cents, or 0.4 per cent, at $81.08 a barrel at 0051 GMT, according to a report by Reuters.
As Iraq expressed support for OPEC+ oil reduction last Friday, both benchmarks rose roughly 2 per cent. However, they dropped almost 4 per cent for the week, recording their third weekly loss for the first time since May.
"Investors are more focused on slow demand in the United States and China while worries over the potential supply disruptions from the Israel-Hamas conflict have somewhat receded," Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan Securities, told Reuters.
The U.S. Energy Information Administration (EIA) announced last week that while consumption will decline, crude oil production in the country will increase this year by a little less than anticipated.
The world's largest importer of crude oil, China, released weak economic data last week, which added to concerns about the decline in demand. Furthermore, China's refiners requested reduced supplies for December from Saudi Arabia, the biggest exporter in the world.
Nevertheless, Kikukawa stated that if WTI hits $75 per barrel, oil prices would be sustained.
"If the market falls further, we will likely see support buying on expectations that Saudi Arabia and Russia would decide to continue their voluntary supply cuts after December," Kikukawa told Reuters.
Leading oil exporters Saudi Arabia and Russia announced last week that they would keep reducing their voluntary oil output until the end of the year because to worries about demand and economic expansion, which is keeping the price of crude oil down.