Oil falls on lower China growth targets, doubts on Russian output curbs

Oil prices fell in Asian trade on Monday, wiping out some of the gains of the previous session amid worries lower growth targets in China could cut oil demand and ongoing concern over Russia’s compliance with a global deal to cut oil output.

But worries over escalating violence in the Middle East put a floor under prices.

Brent crude futures dropped 47 cents, or 0.8 percent, to $55.43 a barrel as of 0749 GMT after settling 1.5 percent higher in the previous session.

U.S. West Texas Intermediate (WTI) crude futures fell 47 cents, or 0.9 percent, to $52.86 a barrel after closing the previous session up 1.4 percent.

“The main drag affecting markets today is the lowering of growth targets by China and tighter regulatory controls which implies less demand for oil and commodities in general,” said Jeffrey Halley, senior market strategist at Oanda brokerage in Singapore.

China aims to expand its economy by around 6.5 percent this year, Premier Li Keqiang said in his work report at the opening of the annual meeting of parliament on Sunday.

That is lower than the 6.7 percent growth achieved last year.

China also plans to cut steel and coal output this year in an effort to tackle pollution, its top economic planner said on Sunday, while China’s newly appointed banking regulator vowed on to strengthen supervision of the lending sector.

Meanwhile, figures by Russia’s energy ministry released last week showed February oil output was unchanged from January at 11.11 million barrels per day (bpd), casting doubt on Russia’s moves to rein in output as part of a pact with oil producers last year. Read more:http://www.reuters.com/