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Brent crude for July, which expires on Tuesday, rose $2.11, or
1.7%, to $123.78 a barrel by 1103 GMT, after earlier rising to
$124.10 - its highest since March 9. The August contract rose
$1.57 to $119.17.
The premium of August-loading Brent contracts over a six-month
spread hit a nine-week high at close to $15 a barrel, indicating
current supply tightness.
U.S. West Texas Intermediate (WTI) crude was trading at $118.53
a barrel, up $3.46 in a fourth consecutive session of gains, up
3% from Friday's close, hitting its highest since March 9. There
was no settlement on Monday due to a U.S. public holiday.
Both July-loading contracts are set to end May as the sixth
straight month of rising prices.
European Union leaders agreed in principle to cut 90% of oil
imports from Russia, the bloc's toughest sanction yet on Moscow
since the invasion of Ukraine three months ago.
Once fully adopted, sanctions on crude oil will be phased in
over six months and on refined products over eight months. The
embargo exempts pipeline oil from Russia as a concession to
Hungary.
"As two-third of the Russian crude oil exports are seaborne
around 1.5 million barrels per day (bpd) of oil will need to be
replaced by the EU," PVM analyst Tamas Varga said.
"This volume is actually closer to 2.1-2.2 million bpd as both
Poland and Germany are planning to phase out pipeline purchases
by the end of the year."
On the production side, OPEC+ is set to stick to a modest July
output hike of 432,000 barrels per day, six OPEC+ sources said.
Oil prices found further support as Shanghai has announced an
end to its COVID-19 lockdown, and will allow people in China's
largest city to leave their homes and drive their cars from
Wednesday.
(Additional reporting by Jeslyn Lerh; editing by Carmel Crimmins,
Kirsten Donovan)
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