By Biman Mukherji

Oil prices continued to weaken Monday, building on Friday's slide as worries about increased production were amplified by the potential of Chinese tariffs on energy imports from the U.S.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in July were down 1.8% at $63.88 a barrel in the Globex electronic session. August Brent crude on London's ICE Futures exchange fell 0.8% to $72.84. Both had rebounded a bit from earlier lows.

Energy-related products have been mentioned as China plans retaliatory tariffs against the U.S. That could mean that the world's biggest importer of oil could eschew U.S. products at a time when exports of crude, coal and liquefied natural gas to Asia have been rising.

Oil prices have also been pulled lower by reports Russia and Saudi Arabia are considering a plan to raise output by more than 1.5 million and 1 million barrels, respectively. A meeting of the Organization of the Petroleum Exporting Countries and other major producers starts Friday to consider raising production caps which have been in place since the start of 2017.

With several other OPEC members, including Iran, resisting efforts for the group to boost output because of the potential implication for prices, whether--and how much--production might rise remains in question, analysts say.

But Gnanasekar Thiagarajan, director at Commtrendz Risk Management, thinks "most will fall in line because Saudi Arabia and Russia are the largest producers." He sees WTI possibly falling to $61 per barrel and Brent dropping below $70 in the near term.

Also a recent pressure point on oil lately has been the U.S. dollar's ongoing strength. The WSJ Dollar Index o Friday was at its highest late New York level in 11 months. At the same time, the U.S. oil benchmark has fallen four straight weeks, its longest losing streak since August.

Monday's drop in oil futures also came as other risky assets in Asia, notably stocks, fell across the region. Meanwhile, traditional safe havens like gold, U.S. Treasurys and the Japanese yen rose.

Write to Biman Mukherji at biman.mukherji@wsj.com

(END) Dow Jones Newswires

June 18, 2018 02:17 ET (06:17 GMT)

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