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Brent crude futures were down 88 cents, or 1%, at $86.66 a
barrel, as at 1016 GMT. U.S. West Texas Intermediate (WTI) crude
was at $82.16 a barrel, down $1, or 1.2%.
Talks over a U.S. ceasefire plan to end the nine-month-old war
in Gaza are under way and being mediated by Qatar and Egypt.
If anything concrete comes from the ceasefire talks, it will
take some of geopolitical bid out of the market for now, said IG
analyst Tony Sycamore.
"Oil did not take advantage of the weaker dollar, coming under
some selling pressure on rising expectations of a ceasefire in
the Middle East," said Charalampos Pissouros, senior investment
analyst at brokerage XM.
Meanwhile, in the United States, Hurricane Beryl made landfall
near Matagorda Texas on Monday. Ports of Corpus Christi,
Houston, Galveston, Freeport and Texas City closed on Sunday to
prepare for hurricane.
"Weekly settlement prices suggest that investors liked what they
saw in spite of the pre-weekend profit-taking in oil, which
continues this morning on the prospect of the resumption of
ceasefire talks between Israel and Hamas and the closure of
Texan ports", said PVM analyst Tamas Varga.
Port closures could bring a temporary halt to crude and
liquefied natural gas exports, oil shipments to refineries and
motor fuel deliveries from those plants.
"While this puts some offshore oil and gas production at risk,
the concern when the storm makes landfall is the potential
impact it could have on refinery infrastructure," ING analysts
led by Warren Patterson said in a note.
WTI gained 2.1% last week after data from the Energy Information
Administration showed stockpiles for crude and refined products
fell in the week ended June 28. [EIA/S]
IG's Sycamore said there is also a good chance of U.S. data
showing another large weekly draw in U.S. oil inventories amid
peak driving season.
Investors were also watching for any impact from elections in
the UK, France and Iran last week on geopolitics and energy
policies.
(Reporting by Arunima Kumar in Bengaluru and Florence Tan in
Singapore; Editing by Christopher Cushing, Sherry Jacob-Phillips
and Arun Koyyur)
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