Oil prices dived on Monday, erasing Friday's gains following an output cut deal between OPEC and its allies, as further global stock markets weakness spurred concerns over slowing global economic growth.

U.S. stocks extended dramatic losses in intraday trading on Monday, as the Dow reached a trough and erased more than 500 points at its low. The sharp fall came on the heels of the steep losses last week.

Analysts cautioned that the stock market slump would turn to undermine oil market, as the negative status quo stoked fears of a slower-than-expected global economy and a worsening demand outlook.

Oil prices rebounded on Friday after OPEC and its allies including Russia agreed to cut oil production by a total of 1.2 million barrels per day. The reduction scheme came in face of U.S. President Donald Trump's repeated calls for further declining prices.

Saudi Minister of Energy, Industry and Mineral Resources Khalid al-Falih on Monday discussed oil market conditions with U.S. Secretary of Energy Rick Perry during Perry's visit to Dhahran, Saudi Arabia.

Al-Falih said on Twitter that they also talked about "the Kingdom's efforts to develop technologies to reduce carbon emissions, energy efficiency and opportunities for technical cooperation between the two countries."

The West Texas Intermediate for January delivery decreased 1.61 U.S. dollars to settle at 51 dollars a barrel on the New York Mercantile Exchange, while Brent crude for January delivery fell 1.7 dollars to close at 59.97 dollars a barrel on the London ICE Futures Exchange.