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West Texas Intermediate U.S. crude futures (WTI) traded at
$76.68 a barrel, 36 cents, or 0.5% higher, while Brent crude
futures were up 34 cents, or 0.4%, at $83.50 a barrel at 0950
GMT.
Both benchmarks closed more than 90 cents higher on Friday.
Russia halted supplies of oil to Poland via the Druzhba
pipeline, the chief executive of Polish refiner PKN Orlen said
on Saturday, a day after Poland delivered its first Leopard
tanks to Ukraine.
Russian oil pipeline monopoly Transneft attributed the shut-off
to lack of completed paperwork for supplies in the second half
of February.
Russia announced plans earlier this month to cut oil exports
from its western ports by up to 25% in March versus February,
exceeding its previously mooted production cuts of 5%.
Meanwhile, the dollar hovered near a seven-week peak on Monday
after a slew of strong U.S. economic data reinforced the view
that the Federal Reserve will have to raise interest rates
further and for longer.
A firm dollar makes commodities priced in the U.S. currency more
expensive for holders of other currencies.
Fears of a hawkish Fed returned to the fore after data on Friday
showed the U.S. personal consumption expenditures (PCE) price
index shot up 0.6% last month after gaining 0.2% in December.
"Crude continues to take direction from the sentiment in the
broader financial markets," said Vandana Hari, founder of oil
market analysis provider Vanda Insights. "If risk-aversion
continues to grow, crude will likely come under renewed
pressure."
Adding to downside pressure, U.S. crude oil inventories surged
to the highest level since May 2021 last week, data from the
Energy Information Administration (EIA) showed.
Separately, investors are bracing for China's manufacturing
surveys this week for a clear direction on oil demand. China is
holding its annual parliamentary meeting from this weekend and
will see new economic policy targets and policies.
(Additional reporting by Mohi Narayan in New Delhi and Sudarshan
Varadhan in Singapore; Editing by Tom Hogue, Kirsten Donovan)
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