Oil prices hit 12-year lows on concerns over the global oil oversupply. Today's drop in the Chinese stock indexes added to concerns over the slowdown in the Chinese economy.

A stronger U.S. dollar also weighed on oil prices, making oil more expensive to foreign buyers.

Iran plans to invest in a refinery in Spain. The refinery would help to access the European market once the sanctions are lift off.

Abbas Kazemi, the head of the state-run National Iranian Oil Refining and Distribution Co., said over the weekend that Iran plans to invest in refineries abroad to boost oil exports.

WTI crude oil for February delivery declined to $31.64 a barrel on the New York Mercantile Exchange.

Brent crude oil for February fell to $31.80 a barrel on ICE Futures Europe.