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Crude hit from all sides, dragging WTI and Brent lower

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Crude oil fell on Monday, pressured by reports that China's manufacturing sector contracted and Libya's oil output was recovering.

U.S. gasoline prices fell to their lowest point since April 3 as traders sold off long positions ahead of the switch in gasoline grades for the summer driving season. The seasonal trend pulled the entire global oil complex lower, analysts said.

Brent crude for June delivery was down more than $1 near $107 a barrel. U.S. oil fell 28 cents to end the session at $99.48. U.S. gasoline fell 5 cents to $2.8945 a gallon. The contract rose to a high of $3.1128 on April 24, and has fallen steadily since.

Ample supply is also weighing on the contract. Last week's report from the U.S. Energy Information Administration showed an unexpected increase in gasoline stockpiles. The result of the HSBC/Markit purchasing managers' index for China added to worries that the Chinese economy is still losing momentum. In Libya, tribesmen ended a blockade of the El Sharara oilfield and engineers said they hoped to resume pumping within a week.

The global oil market appeared to shrug off the ongoing violence in Ukraine. Pro-Russian rebels shot down a Ukrainian helicopter in fierce fighting near the eastern town of Slaviansk, and Kiev drafted police special forces to the southwestern port city of Odessa to halt a feared westward spread of rebellion.

Capping losses in U.S. crude oil was news that growth in the U.S. services sector accelerated in April, rising at the fastest pace in eight months, providing further evidence that economic activity is regaining momentum after lagging through much of the harsh winter.

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