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Brent crude futures were down 38 cents, or 0.4%, at $75.72 a
barrel by 0900 GMT. U.S. West Texas Intermediate crude was at
$70.76 a barrel, down 26 cents, or 0.3%.
Last week, Brent and WTI fell to their lowest since December
2021 amid concerns that a possible global recession will impact
oil demand.
China, the world's biggest crude oil importer, continued to
loosen its strict zero-COVID policy, though streets in the
capital Beijing remained quiet and many businesses stayed shut
over the weekend.
On Monday, queues formed outside fever clinics in the cities of
Beijing and Wuhan, where COVID first emerged three years ago.
"Oil markets will likely stay volatile in the near term amid
uncertainty over the impact on Russian output from the EU's ban,
headlines on China's COVID policy, and central bank movements in
the U.S. and Europe," UBS analysts said in a note.
UBS said it believed Brent should recover to above $100 per
barrel in the coming months amid supply constraints and rising
demand while OPEC+ would keep supply tight.
On Sunday, Canada's TC Energy said it had not yet determined the
cause of the Keystone oil pipeline leak last week in the United
States. It gave no timeline as to when the pipeline would resume
operation.
The 622,000 barrel-per-day Keystone line is a critical artery
shipping heavy Canadian crude to U.S. refiners.
Russian President Vladimir Putin said on Friday that Russia
could cut production and would refuse to sell oil to any country
that imposes a "stupid" price cap on Russian exports.
Saudi Arabia's energy minister also said on Sunday that price
cap measures had had no clear results yet.
"The emergent EU embargo on Russian crude... may add moderate
upside energy price risks in the next few months. But supply
uncertainty should ease by spring 2023, after the embargo on oil
products (on Feb.5) plays out," Deutsche Bank said in a note.
(Reporting by Florence Tan and Emily Chow in Singapore; Editing
by Christian Schmollinger, Bradley Perrett and Simon
Cameron-Moore)
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