UPDATE 8-Oil loses $1 as emerging markets struggle, U.S. Fed weighs

Mon Jan 27, 2014 3:31pm EST
 
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* U.S. Fed to hold two-day meeting, consider tapering

* Investors worry about commodities demand in emerging markets

* U.S. new-home sales come in lower than expected

By Anna Louie Sussman

NEW YORK, Jan 27 (Reuters) - Brent crude oil futures shed more than $1 a barrel on Monday, and U.S. crude fell almost as much, as investors kept dumping risky assets on worries about weaker growth in emerging markets.

Global equities markets extended losses from last week on concerns about China's economic slowdown and expectations that the U.S. Federal Reserve will scale back its bond buying by another $10 billion a month.

The U.S. government also announced weaker-than-expected new home sales data, causing U.S. equities to give back early gains and triggering a dip in Brent and U.S. crude oil futures prices.

"There were a lot of warning signs from China and the emerging markets late last year, and now we're in a new year and not quite as optimistic," said Phil Flynn, an analyst at the Price Futures Group in Chicago, Illinois.

Brent crude shed $1.19 to settle at $106.69 a barrel.   Continued...