By Amrith Ramkumar and Christopher Alessi 

Oil prices tumbled Monday as fresh OPEC supply data and continued strength in the dollar spooked traders.

Light, sweet crude for September delivery fell 2.1% to $66.21 a barrel on the New York Mercantile Exchange, on track for its lowest close since late June. Brent crude, the global benchmark, slumped 1.7% to $71.55 a barrel. Prices have fallen more than 10% from their multiyear highs hit earlier this year, hurt in recent weeks by the prospect that higher output from Saudi Arabia and other large producers will ease fears of a supply shortage.

Data Monday showed crude-oil output from the Organization of the Petroleum Exporting Countries ticked up slightly in July even as production in Saudi Arabia -- the de facto leader of the group -- declined.

Investors have also had to monitor recent trade tensions and weakness in emerging markets like Turkey, factors that could lower demand and continue boosting the dollar. A stronger dollar makes commodities priced in the U.S. currency more expensive for overseas buyers. On Monday, the WSJ Dollar Index, which tracks the dollar against a basket of 16 other currencies, rose 0.4% coming off its highest close since May 2017.

As has been the case in recent weeks, analysts said selling accelerated later in the session as oil moved below closely watched technical levels.

"Bearish sentiment is starting to infiltrate the crude-oil market," said Bob Yawger, director of the futures division at Mizuho Securities U.S.A. "As we traded through Friday's low, there were people that wanted to get out."

Hedge funds and other speculative investors reduced net bets on higher oil prices for the fifth consecutive week during the week ended Aug. 7, according to Commodity Futures Trading Commission figures released late Friday. Speculators pushed bullish bets to record levels earlier this year.

Some analysts expect oil prices to remain volatile, with uncertainty still surrounding U.S. sanctions against Iran, the speed at which large suppliers will boost output and global trade policies that could impact consumption. The International Energy Agency on Friday raised its forecast for global oil-demand growth by 110,000 barrels a day to 1.5 million barrels for 2019

Still, analysts say protectionism and the prospect that this year's emerging-markets rout could spread are making traders doubt that consumption will continue to grow. Strong demand from emerging markets helped push oil to its highest level since 2014 earlier this year, said Gene McGillian, vice president of research at Tradition Energy.

"There's some doubts about demand going forward," he said. "There's a little bit of worry that we could go from tightening supply-demand fundamentals to loosening."

Analysts were looking ahead to weekly data on U.S. inventories, scheduled to be released Wednesday, for the latest reading on domestic production, as some think robust U.S. supply could keep prices under pressure.

Some investors think oil prices will rebound as a recent bout of volatile trading continues, noting that they started the day higher even after OPEC's latest supply data and with the dollar rising. At times in recent weeks, traders have struggled to pinpoint fundamental reasons for sharp moves in prices, pointing instead to technical trading.

"We've had some pretty volatile days in the last month," Mr. McGillian said. "That's because of the uncertainty."

Among refined products Monday, gasoline futures shed 2.1% to $1.9959 a gallon. Diesel futures dropped 1.3% at $2.1125 a gallon.

Write to Amrith Ramkumar at amrith.ramkumar@wsj.com and Christopher Alessi at christopher.alessi@wsj.com

(END) Dow Jones Newswires

August 13, 2018 14:42 ET (18:42 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.