The benchmark US crude contract, WTI, was down by 6.1 percent at $67.42 per barrel around 1435 GMT.

Europe's Brent North Sea shed 5.4 percent to $69.61.

OPEC crude producers and their allies on Sunday agreed to pump an extra 400,000 barrels per day from August to meet rising demand as economies reopen.

At the same time, market are increasingly nervous that the spreading Delta virus variant could undermine the economic recovery.

Edward Moya, an analyst at Oanda trading group, said investors worldwide were selling stocks, commodities and cryptocurrencies and instead buying US Treasuries, or bonds, which were seen as a safer bet.

"Risk aversion is firmly in place as the Delta Covid variant spread is triggering a flight to safety as global economic concerns intensify," he added in a client note.