The price of US oil fell to near $104 a barrel today, taking a negative cue from a sharp drop in the Nikkei stock index.
West Texas Intermediate, the benchmark for US crude, was down 44 cents to $104.26 a barrel in electronic trading on the New York Mercantile Exchange.
The contract fell 79 cents to close at $104.70 on Friday in New York.
Analysts said the weak performance of Japan's stock market spilled over into energy trading. The Nikkei 225 index dropped 2.5%, weighed down by a strengthening yen and worries about China's economy.
Traders are also waiting to see whether the US Federal Reserve will announce any alteration to its loose monetary policy.
The Fed has been nudging the US economy by buying massive amounts of government bonds, which has pushed borrowing rates sharply lower. But the programme is widely expected to be scaled down later this year as the economy improves.
Oil prices declined last week after China, a major energy consumer, decided to press ahead with painful economic restructuring and forgo another round of stimulus even though growth has slowed.
The price of oil broke above $100 on July 3 for the first time since May 2012, mostly due to falling US crude stockpiles and increased interest from financial investors.
