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Oil drops below $100 as supply reports awaited

Pablo Gorondi, Associated Press

Oil sagged to below $100 a barrel Monday for the first time since early July as traders waited for the delayed release of U.S. supply figures that are expected to show another rise in crude stockpiles.

By early afternoon in Europe, benchmark crude was down 85 cents a barrel to $99.96 in electronic trading on the New York Mercantile Exchange. The contract rose 14 cents Friday, lifted by an improvement in China's quarterly economic growth.

Data on U.S. crude and fuel stockpiles had been postponed last week due to the U.S. government shutdown.

The Energy Information Administration will release data for the week ended Oct. 11 on Monday. The supply report for last week will be released Wednesday.

Expectations for a supply build were bolstered last week by a report from the industry-funded American Petroleum, which said that U.S. stocks of crude oil rose by 5.9 million barrels in the week ending Oct. 11, more than twice the build expected by analysts.

The EIA's weekly supply report is considered the market benchmark. Its last release, on Oct. 9, showed a rise of 6.8 million barrels in U.S. crude stocks.

"The ample and rising supply of oil, combined with a weaker demand growth prospects, point toward lower prices in the months ahead," said Fawad Razaqzada of GFT Global Markets in London.

Other factors weighing on oil prices in the past weeks include the agreement to dismantle Syria's chemical weapons, apparent progress between Iran and world powers on Tehran's nuclear program and expectations of a significant rise in oil production in the United States.

Brent crude, the international benchmark, was down 26 cents to $109.68 a barrel on the ICE Futures exchange in London.

In other energy futures trading on Nymex:

— Wholesale gasoline fell 0.43 cent to $2.6536 a gallon.

— Natural gas rose 2.2 cents to $3.786 per 1,000 cubic feet.

— Heating oil shed 1.11 cents to $3.0209 a gallon.