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Brent crude futures fell 18 cents, or 0.2%, to $77.15 a barrel
by 1003 GMT, while U.S. West Texas Intermediate futures were at
$72.04 a barrel, down 24 cents, or 0.3%.
Both benchmarks ended last week down about 7% after
stronger-than-expected U.S. jobs data suggested interest rate
cuts could be further out than expected.
The blockbuster report showed job growth accelerating in January
and wages up by the most in nearly two years, signs that could
complicate interest rates cuts by the U.S. Federal Reserve
financial markets had envisioned could start in May.
The data "pushes the timeline for Fed's highly anticipated
cutting cycle out into the second quarter", said Jeff Schulze,
head of economic and market strategy at ClearBridge Investments.
Meanwhile progress on ceasefire negotiations between Israel and
Hamas appeared elusive, indicating tensions in the oil-producing
region are set to linger.
"Hopes of a ceasefire between Israel and Hamas drove some of
this weakness," ING analysts said in a note. "However, for now,
a ceasefire does not appear imminent."
Investors remained wary of any escalation in the Middle East
conflict, after the U.S. signalled further strikes on
Iran-backed groups in the Middle East in response to a deadly
attack on U.S. troops in Jordan.
The U.S. also continued its campaign against Houthis in Yemen
whose attacks on shipping vessels have disrupted global oil
trading routes, although supply has been largely unaffected.
"Oil markets will likely respond by continuing to discount
supply disruption risks in the Middle East," said Commonwealth
Bank commodities analyst Vivek Dhar in a note, adding that would
likely keep Brent futures below $80 a barrel.
In Russia, two Ukrainian attack drones struck the largest oil
refinery in the country's south on Saturday, a source in Kyiv
told Reuters, the latest in a series of long-range attacks on
Russian oil facilities which has reduced Russia's exports of
naphtha, a petrochemical feedstock.
Lukoil, which owns the 300,000 bpd Volgograd refinery, later
said the plant was working as normal.
(Reporting by Noah Browning, Florence Tan and Colleen Howe in
Beijing; Editing by Sonali Paul, Christopher Cushing and Ros
Russell)
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