
Oil posted five-session gains previously with hopes of rising demand following colder weather in the Northern Hemisphere and more fiscal stimulus by China to revitalise its economy.
However, the strength of the dollar is on investor’s radar, Priyanka Sachdeva, a senior market analyst at Phillip Nova, wrote in a report on Monday.
The dollar stayed close to a two-year peak on Monday. A stronger dollar makes it more expensive to buy the greenback-priced commodity and hence reins in pressure on oil.
Minutes of the Fed’s last meeting is due Wednesday and the December payrolls report will come on Friday.
Also weighing on sentiment was supply disruptions of Iranian and Russian oil as Western countries ramped up their sanctions.
The Biden administration plans to impose more sanctions on Russia over its war on Ukraine, taking aim at its oil revenues with action against tankers carrying Russian crude, two sources with knowledge of the matter said on Sunday.
Goldman Sachs expects Iran’s production and exports to fall by the second quarter as a result of expected policy changes and tighter sanctions from the administration of incoming U.S. President Donald Trump.
Output at the OPEC producer could drop by 300,000 barrels per day to 3.25 million bpd by second quarter, they said.
#The U.S. oil rig count, an indicator of future output, fell by one to 482 last week, a weekly report from energy services firm Baker Hughes showed on Friday.
Still, the global oil market is clouded by a supply surplus this year as a rise in non-OPEC supplies is projected by analysts to largely offset global demand increase, also with the possibility of more production in the U.S. under Trump.