Oil prices dip as traders weigh China's downbeat economic data and new lockdowns

• Oil prices declined Monday as Chinese factory data raised concerns about energy demand.
• New COVID-19 lockdowns in China also dampened the outlook for crude prices. 
• WTI crude dropped 3.44%, while Brent crude, the international benchmark, slipped 2.77%.

Oil prices dropped Monday as downbeat factory data and new COVID-19 lockdowns emerged from China. 

West Texas Intermediate crude slipped as much as 3.72% to $94.96, while Brent crude, the international benchmark, dropped 2.60% to $101.37

Government data from China, the world's top crude oil importer, showed the Caixin/Markit manufacturing purchasing managers' index dropped to 50.4 in July, down from 51.7 the month before, well below expectations. Additionally, Japanese manufacturing data in July clocked in at the weakest rate in 10 months, Monday figures showed. 

Authorities last week also shut down Wuhan, a city of about one million people, after four new cases were reported. The country is still purusing its strict zero-COVID policy and has reacted strongly to new positive cases with sweeping lockdowns. 

On the oil supply side, Libya is ramping up production after output was slashed half in recent months. The country is producing 1.2 million barrels a day now, Bloomberg reported, a mark it hasn't hit since April. 

Weighed down by red-hot inflation and fears of a downturn, the US and international crude benchmarks have notched two consecutive monthly losses for the first time since 2020. The Fed reported last week that the US economy shrank for two consecutive quarters, meeting the widely held definition of a technical recession. 

Now, traders are weighing what will happen this week as OPEC+ members convene on Wednesday to discuss September oil output.