Weighing on the market were assurances from the Organization of Petroleum Exporting Countries' president that the group remained on track to boost its oil-output ceiling again in May, among other bearish events.
Benchmark light, sweet crude futures for May fell 72 cents to trade at $52.60 a barrel midday, recovering from an early loss of as much as $1.22 to $52.10 a barrel on the New York Mercantile Exchange.
In London, Brent crude for May traded at $51.97 a barrel, down 92 cents, after falling as much as $1.37 to a low of $51.52 a barrel on the International Petroleum Exchange.
Sheik Ahmad Fahad al-Ahmad al-Sabah, OPEC's president and Kuwait's oil minister, told reporters in Kuwait on Saturday that OPEC remained ready to increase its targeted oil-output ceiling to 28 million barrels a day. The boost would build on OPEC's decision to raise its output ceiling 500,000 barrels a day to 27.5 million barrels a day in March.
Mr. Al-Sabah said he would continue talks by phone with OPEC ministers to prepare for the increase. OPEC's decisions are closely watched, as it supplies more than a third of the world's oil.
Also taking the edge off oil-supply concerns Monday were comments from the head of the Paris- based International Energy Agency, Claude Mandil, who predicted OPEC would be able to satisfy the world's oil needs during the fourth quarter peak-demand season.
"We expect that the call on OPEC in the fourth quarter will be less than OPEC production, or at least OPEC capacity," Mr. Mandil told reporters on the sidelines of a Russian investment conference.
While his comments might soothe fears of tight oil supplies later this year, Mr. Mandil said he was "less comfortable" with petroleum-inventory levels in the Far East, where demand has continues to surge.
The IEA, the energy-security watchdog for the world's industrialized nations, plans to release its monthly oil market report Tuesday.
Also contributing to Monday's softer prices was a decision by Nigerian oil unions to suspend a three-day strike set to begin Monday.
Oil prices have shed about 10% of their value since hitting last Monday's record high of $58.28 a barrel. The May front-month contract fell every day last week, marking the sharpest weekly decline in four months.
Though some traders expect oil to extend last week's hefty deficits, they were by no means aligned. "We were overbought last week and now I think we're oversold," said DeCarlo Larry, head of energy futures in New York for Barclays Capital. "You're probably going to see a little bit of recovery here."
Nymex refined-product futures held onto much of their early losses, with heating-oil futures posting the biggest declines.
Gasoline futures on Nymex resisted an all-out sell-off, however, as the Lundberg Survey of 7,000 gas stations showed U.S. retail gasoline prices rose to another record high of $2.29 a gallon in the three-week period ended Friday.
Nymex May gasoline futures slid 1.26 cents midday to trade at $1.5240 a gallon, while May heating-oil futures traded down 3.42 cents at $1.4630 a gallon.
GRAINS: Soybean and grain futures were mostly lower on the Chicago Board of Trade. Wheat for May delivery remained unchanged at $3.10 a bushel, while May corn fell one cent to $2.03 a bushel. May oats also fell one cent to $1.56 a bushel, and May soybeans fell four cents to $6.07 a
bushel.
LIVESTOCK: Beef futures advanced in trading on the Chicago Mercantile Exchange, while pork futures declined. June live cattle rose 0.23 cent to 83.95 cents a pound, and May feeder cattle rose 0.15 cent to $1.0495 a pound. May lean hogs fell 0.17 cent to 76.05 cents a pound, and May pork bellies fell 0.95 cent to 92.85 cents a pound.