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Oil tumbles anew, Brent hammered below $97 amid supply fears

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Expiring front-month U.S. October crude oil futures extended losses to more than $1 on Monday, as ample supply and concerns about sluggish demand for petroleum from Europe and China put pressure on prices.

Brent crude fared no better, dropping for the third session in four, as demand and supply fears outweighed expectations of a cut in oil output from the Organization of the Petroleum Exporting Countries (OPEC). Comments from OPEC's secretary general last week that the group could cut output next year buoyed Brent, but investors' attention turned back to the gloomy economic outlook in Europe and China, which has curbed oil demand.

A cut in Libya's oil output had limited impact on prices.

November Brent crude was trading nearly $2 lower to under $97 a barrel, after posting its first weekly rise in three last week. U.S. crude for October delivery fell by 78 cents to settle at $90.87 a barrel. The contract expired at the end of the Monday's trading session.

OPEC members, many of whom require oil prices at above $100 to meet budgetary needs, will review the organisation's oil output policy at its next meeting on Nov. 27. Oil production in Libya has fallen to 700,000 barrels per day (bpd), down nearly 20 percent from 870,000 bpd a week ago as its El Sharara oilfield and Zawiya refinery stay closed, a spokesman for the state-run National Oil Corp (NOC) said on Sunday.

Fighting has intensified in southern Libya as soldiers and police clashed in the last few days near the country's biggest oilfield El Sharara. The field was shut last week because of damage to a storage facility at the Zawiya refinery in the north, which it feeds.

But concerns over extended stagnation in Europe, that could pull down other economies, were highlighted at the G20 meeting in Australia on Sunday. Investors will look for clues on where demand from China, the world's second-largest economy, is heading from its flash manufacturing PMI reading due out on Tuesday.