LONDON: Oil fell sharply on Monday, extending recent heavy losses, as mounting political uncertainty in Greece and worry about the prospects for growth in China added to a sense that the demand outlook is worsening.
Adding to jitters about the future of the euro zone, Greece's radical leftist leader spurned an invitation from the president for a final round of coalition talks on Monday, pushing Athens to the brink of fresh polls.
This added to already mounting worries of a global economic slowdown triggered by last week's lacklustre industrial output data from China, the world's second-largest economy and energy consumer.
Brent crude slipped $1.69 to $110.57 a barrel by 1117 GMT, stretching its losses into a third session, after settling at $112.26 on Friday.
It earlier fell more than $2, and was heading for its lowest close since Jan. 25. It was as high as $128 per barrel at the start of March.
US crude fell $1.86 to $94.27. It sunk to its lowest since December 19.
"With the Greek elections putting in peril the euro zone unity, the Chinese industrial production putting in peril the main engine of growth...last week was a pretty bad week for global sentiment," said Olivier Jakob, at Petromatrix in Zug.
He said this poor sentiment was dragging on into this week, and that a Saudi call for oil at $100 per barrel was adding to the negative tone.
SAUDI PRICE TARGET
The world's biggest exporter, Saudi Arabia wants an oil price of around $100 a barrel and would like to see global inventories rise before demand picks up in the second half of the year, Oil Minister Ali al-Naimi said.
China's central bank on the weekend cut the amount of cash banks must hold as reserves, freeing an estimated 400 billion yuan ($63.5 billion) for lending, after data showed the economy weakening, not recovering, from its slowest quarter of growth in three years.
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