Supply concerns also help price upticks with OPEC and International Energy Agency warning last week of supply shortages
Oil prices edged up on Monday, supported by a weaker dollar, as investors weighed tight supplies and the impact on fuel demand from the COVID-19 pandemic after China reimposed several restrictions.
International benchmark Brent crude was trading at $102.68 per barrel at 09.33 a.m. local time (0633 GMT) for a 1.50% increase after the previous session closed at $101.16 a barrel.
American benchmark West Texas Intermediate (WTI) was at $95.88 per barrel at the same time for a 1.38% gain after the previous session closed at $94.57 a barrel.
The US dollar index, which measures the value of an American dollar against a basket of currencies, including the Japanese yen, British pound, Canadian dollar, Swedish krona and Swiss franc, declined from multi-year highs to 107.88 on Monday, posting a 0.17% loss for the day.
The decline in the greenback’s value is encouraging oil-importing countries to purchase more crude at cheaper, dollar-denominated prices.
Both benchmarks recorded their largest monthly declines last week, with Brent dropping below $98 a barrel over fears of an economic recession.
The recent climb in inflation figures,which at the same time hit oil demand, has also triggered worries that the US Fed could make a rate hike of 100 basis points at the conclusion of its two-day meeting on July 27.
However, US Federal Reserve Governor Christopher Waller said Thursday he supports another interest rate hike of 75 basis points later this month.
Supply concerns also supported prices as both OPEC and the International Energy Agency warned last week that supply shortages are likely amid robust demand.
Meanwhile, renewed COVID-19 outbreaks in China, threatening a halt in demand recovery, tamed further price rises.