Light sweet crude for August delivery declined 1.38 percent or $1.17 cents to $83.79 a barrel in electronic trading on the New York Mercantile Exchange during Asian trading hours while Brent crude oil futures for August delivery fell 1.51 percent or $1.48 to $96.32 a barrel on the ICE futures exchange in London.
Oil reported the biggest one-day gain in more than three years Friday after EU leaders agreed to create a single euro zone banking supervisory body and let rescue funds be sent directly to the struggling banks, instead of adding to the public debt of their national governments.
On Friday, light sweet crude for August delivery climbed 9.4 percent or $7.27 and settled at $84.96 a barrel on the New York Mercantile Exchange, the fourth largest daily gains in dollar terms since the contracts were launched while Brent crude oil rose $6.44 to settle at $97.80 a barrel, a gain of 7.05 percent and the biggest one day rise since April 2009, Reuters reported.
Meanwhile, news that manufacturing activity in China slowed further in June also weighed on oil prices. Data released Sunday by the National Bureau of Statistics and China Federation of Logistics and Purchasing show that official Purchasing Managers' Index (PMI) continued to decelerate in June, falling to 50.2 from 50.4 in May, the lowest reading since November 2011, when it hit 49.