By Bernie Woodall
LOS ANGELES (Reuters) - Oil prices fell about $1 to settle at a five-month low on Monday as concerns over weakening demand in the midst of a financial meltdown continued to offset production cuts announced last week by OPEC.
U.S. light crude for December delivery settled at $63.22 a barrel, down 93 cents, its lowest settlement price since May 29, 2007. London Brent crude settled down 64 cents to $61.41 a barrel.
Oil prices have dropped by nearly 60 percent from a record high $147.27 a barrel in July as global economic turmoil dents world fuel consumption.
Demand has fallen in the United States, the world's top energy consumer, and in other industrial countries as the credit crisis infects the wider economy and begins to spread to emerging markets.
In China apparent oil demand rose by just over 2 percent in September, the slowest growth in 10 months.
Oil's losses also limited somewhat by anticipation the Organization of the Petroleum Exporting Countries would start to implement the 1.5 million barrels per day output cut it agreed on Friday.
"While we still have questions about the demand side of the market, we should also appreciate that OPEC took significant measures to balance the market," said Tim Evans of Citigroup Futures Perspective.
Asian oil refiners said they had yet to receive notice of any curbs on their Gulf crude oil shipments, but most were expecting a 5 percent cut.
Iran's OPEC Governor Mohammad Ali Khatibi has said the group would reduce production further if the cut agreed in Vienna on Friday did not stabilize the market. [nBLA720214]
Also limiting oil's losses were continued moves by governments to combat the global financial crisis. South Korea cut interest rates, Australia intervened in the currency market, and the U.S. Federal Reserve set the interest rates for companies buying commercial paper.
The volume of open contracts in energy, metals, grains and soft commodities on major U.S. commodity futures markets fell to its lowest since May 2006 in the week to October 21, as the risk of recession prompted some investors to pull out.
(Additional reporting by Jane Merriman, Barbara Lewis and David Sheppard in London and Fayen Wong in Perth)
