Crude oil prices plunged more than 2 percent to below $98 a barrel in Europe as renewed concerns over the euro zone debt crisis sent the U.S. dollar higher, which made commodities more expensive.
At 4:40 a.m. E.D.T, Light Sweet Crude oil futures for July delivery declined 2.61 percent to $97.52 a barrel and Brent crude oil futures for July delivery declined 2.61 percent to $100.100 a barrel on the ICE futures exchange in London.
The euro declined 1.05 percent to 1.4012 against the dollar and plunged 1.3 percent against yen.
Euro zone debt crisis resurfaced after Fitch Ratings downgraded Greece's credit rating by three notches on Friday, pushing the country deeper into junk. Fitch lowered Greece's rating to B-plus from BB-plus, citing the scale of the challenge facing the nation in implementing reforms to secure its solvency.
Standard & Poor's downgraded Italy's credit rating outlook to negative on concerns over the weak political front that might hurdle the nation's ability to meet its debt reduction targets.
Meanwhile, manufacturing growth in the world’s second largest economy slowed in May after Chinese government tightened the monetary policy in April for four times. Its purchasing managers' index (PMI) declined to 51.1 in May, the lowest since July 2010, compared with previous months reading of 51.8.