(Bloomberg) –Oil fell as equity markets faltered on concern chances of a U.S.-China trade settlement are slipping away.

Futures in New York fell 0.7% on Monday. President Donald Trump dashed expectations over the weekend that a trade deal had been reached. Meanwhile, Oman’s oil chief said OPEC and allied producers probably won’t deepen output cuts when they meet next month.

“Obviously we are a little concerned about the trade war,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.

Oil has rallied more than 8% since early October amid signals the U.S. and China were moving closer to settling the protracted trade dispute that’s undermining energy demand. Hedge funds have cautiously revived bets on rising prices.

West Texas Intermediate for December delivery fell 38 cents to close at $56.86 a barrel on the New York Mercantile Exchange.

Brent for January delivery slid 33 cents to $62.18 on the London-based ICE Futures Europe Exchange. The global crude benchmark traded at a $5.28 premium to WTI for the same month.

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“These days it’s largely the trade war” that’s moving prices, Bob McNally, president of Rapidan Energy Group and a former oil official at the White House under President George W. Bush, said in a Bloomberg TV interview on Monday. “Folks are also looking into early next year and seeing an oversupplied market, and there’s questions whether OPEC+ will rise to the challenge.”

Other oil-market news

• Gasoline futures fell 1.5% to close at $1.6099 a gallon.
• Saudi Arabia boosted oil production to 10.3 million barrels a day last month to refill inventories depleted after the attack on the Abqaiq processing facility.
• BP Plc, Royal Dutch Shell Plc, Total SA and Vitol Group are among partners in a new exchange to trade Abu Dhabi’s flagship oil grade in what could become a new price benchmark for a fifth of the world’s crude.
• Two of the world’s most important grades of crude — Saudi Arabia’s Arab Light and Russia’s Urals — would lose oil refineries money in key processing regions, and new rules to improve the shipping industry’s environmental performance are part of the reason.