European shares sank on Monday, pulled lower by BP which began shutting down the biggest oilfield in the United States, with weaker mining and auto stocks adding to the negative tone and trade remaining cautious ahead of Tuesday's Federal Reserve meeting.

Among standouts, Autostrade fell 3.7 percent after Italy rejected a planned takeover of the highway operator by Spain's Abertis.

There's a lack of money in the market which is increasing the volatility. Everyone's waiting to see what the Fed is going to say and do, said a trader. Weaker-than-forecast U.S. July jobs figures on Friday added to expectations the U.S. central bank will hold fire on interest rates rises when it meets.

By 0902 GMT, the pan-European FTSEurofirst index of 300 leading shares was down 1.3 percent at 1,328.5 points, giving back Friday's 1.2 percent rally.

Across Europe, the FTSE 100 fell 1.2 percent, the DAX slipped 1.8 percent while the CAC 40 dipped 1.8 percent.

Wall Street stocks ended Friday's session slightly lower and looked set to extend those gains at Monday's opening.

Shares in BP, which began shutting down its oilfield in Alaska's Prudhoe Bay on Sunday after discovering a small pipeline leak, fell 1.7 percent.

The closure, combined with ongoing worries over Middle East supply as Hizbollah battled Israeli ground troops, helped push crude to $76 a barrel.

Mining stocks slipped, with BHP Billiton down 1.6 percent and Rio Tinto down 1.8 percent as copper drifted after topping $8,000 a tonne on concerns about a strike at Chile's Escondida, the world's biggest copper mine.

Auto stocks slipped with BMW down 2.1 percent after saying its group vehicle sales fell 7.7 percent in July. DaimlerChrysler dropped 1.5 percent and Renault slipped 1.5 percent.