UPDATE 10-Oil prices slip as U.S. economic data weakens demand outlook

* U.S. factory activity sinks to 10-year low in September
* Ecuador to leave OPEC in 2020 due to fiscal problems -
ministry
* OPEC output drops to lowest in 8 years in Sept -survey
* U.S. oil production falls for 3rd month in July -EIA
* U.S. crude oil stocks fall 5.9 mln bbls-API

(Adds API data)
By Laila Kearney
NEW YORK, Oct 1 (Reuters) - Oil futures sank on Tuesday as
weak U.S. economic data dimmed crude's demand outlook and
pressured prices, while reports of a third-quarter decline in
output from the world's largest oil producers kept oil from
falling further.
Brent crude futures LCOc1 settled at $58.89 a barrel, a
36-cent loss, while U.S. West Texas Intermediate crude CLc1
settled at $53.62 a barrel, down 45 cents.
Oil pared some losses in post-settlement trade after
American Petroleum Institute (API) data showed crude stocks
unexpectedly fell last week by 5.9 million barrels, compared
with analysts' expectations for an increase of 1.6 million
barrels. The Energy Information Administration's weekly oil
inventories report is due at 10:30 a.m. EDT (1430 GMT) on
Wednesday. EIA/S
The daily slides followed a session in which both benchmarks
posted their largest quarterly declines of the year.
U.S. manufacturing activity dropped to a more than
decade-low in September as the U.S.-China trade war weighed on
exports, according to a survey from the Institute for Supply
Management (ISM). The ISM manufacturing activity index showed a reading of
47.8, shrinking for the second straight month and below
economists' expectations of 50.1. A reading below 50 indicates
contraction. Oil futures sank along with equities after the factory data
for the world's largest economy. .N
"Negative ISM manufacturing data clobbered the stock market
with spillover into the oil," said Jim Ritterbusch of
Ritterbusch and Associates. "As overseas economic weakening
slowly morphs into the U.S., additional downward revisions in
forecasted global oil demand for this year and next will likely
be forthcoming."
Earlier, oil prices had rallied as a Reuters survey found
crude production in September from the Organization of the
Petroleum Exporting Countries fell to 28.9 million bpd, down
750,000 bpd from August's revised figure and the lowest monthly
total since 2011.
Output at the world's two largest producers, the United
States and Russia, also fell in July and September respectively.
Russia's output declined to 11.24 million bpd in Sept. 1-29
from 11.29 million bpd the previous month, sources said,
although it remained above quotas set in an output deal between
Russia and OPEC. Ecuador said it will withdraw from OPEC from Jan. 1 because
of fiscal problems. U.S. crude oil output fell 276,000 bpd in July to 11.81
million bpd as federal offshore Gulf of Mexico production slid,
the U.S. Energy Information Administration reported on Monday.
U.S. production peaked at 12.12 million bpd in April.
On Monday, oil prices were pressured by news that Saudi
Aramco has restored full oil production and capacity to the
levels that preceded Sept. 14 attacks on its facilities.
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