* Worries about global recovery, euro zone weigh on markets
* China Jan official PMI posts first dip in 8 months
* White House to paint grim fiscal picture - source
(Updates prices, adds China economic data)
By Fayen Wong
PERTH, Feb 1 (Reuters) - Oil prices fell on Monday,
extending the worst loss in 13 months in January on concerns
about global growth and sluggish oil demand.
Fresh economic data out of China, the world's
second-largest energy consumer, heightened concerns that
Beijing would further tighten monetary policy. []
An official purchasing managers index remained firmly in
expansionary territory, while a companion poll by HSBC scaled
an all-time high -- with both reports showing evidence of a
further increase in cost pressures.
U.S. crude for March delivery <CLc1> fell 24 cents to
$72.65 a barrel by 0524 GMT. London Brent crude <LCOc1> fell 26
cents to $71.20.
Oil prices ended January down more than 8 percent,
pressured by data showing tepid energy demand in the United
States, worries about fiscal turmoil in smaller euro zone
countries and a stronger U.S. dollar.
"The cold weather premium is coming off and investors have
to consider the pace of global economic recovery, actual oil
demand and a strengthening U.S. dollar," said Benson Wang, an
oil trader at Commodity Broking Services in Sydney.
"Looking at how crude oil prices have collapsed in the last
1-2 hours of trading in the past few sessions, I think it shows
a trend whereby investors are trying to get out of their long
positions."
Money managers cut their net long crude oil futures
position on the New York Mercantile Exchange in the week
through Jan. 26, the Commodity Futures Trading Commission said
on Friday. []
While the economic data from China showed a strong
manufacturing sector, Beijing's moves last month to rein in
rapid growth and curb inflationary pressures have sparked fears
that such measures could impede a still-weak global economic
recovery and curb Chinese demand for energy and commodities.
Adding to the gloom, the White House will predict a $1.6
trillion U.S. budget deficit in the 2010 fiscal year, a fresh
record and the biggest since World War Two as a share of the
economy, a congressional source told Reuters on Sunday.
[]
Markets are also bracing for other economic news this week,
with a number of major central bank meetings across the world
and a raft of economic reports out of the United States,
culminating in non-farm payrolls data on Friday.
[].
A key U.S. January manufacturing report later on Monday is
expected to give a reading of 55.2, showing an expanding sector
for the sixth straight month.
Asian stocks slid on Monday after suffering their worst
monthly drop in a year, while the U.S. dollar gathered steam,
as fiscal worries in the euro zone prompted investors to add to
short positions in the single currency. []
Royal Dutch Shell <RDSa.L> has shut down three oil flow
stations in Nigeria's Niger Delta after a key crude oil
pipeline was sabotaged, the company said on Sunday.
[]
(Editing by Michael Urquhart)
