Brent crude had risen 5 cents to $88.24 a barrel as of 01:16 GMT, while U.S. West Texas Intermediate (WTI) crude rose 13 cents to $81.75 a barrel.
Crude oil prices in physical markets started the year with a rally, as China, no longer held back by pandemic controls, showed signs of increased buying and traders feared the sanctions against Russia only tighten supply.
However, crude prices are teetering as the dollar stabilizes and headlines about China’s reopening run out, according to OANDA analyst Edward Moya.
In the U.S., “the economy could still turn around and some energy traders are still skeptical about how quickly Chinese crude demand will rebound this quarter,” Moya wrote in a note.
Product demand inflated the oil market and refining margins. The crack 3-2-1 spread, an indicator of refining margins, rose to $42.18 a barrel on Monday, the highest since October.
Investors retreated into oil futures and options at the fastest pace in more than two years as worries about a slowdown in the global economic cycle eased. US investors are fairly certain that the Federal Reserve will implement a modest interest rate hike next week, although it remains determined to get inflation under control, which recent data shows is slowing.
This week, traders are watching for more trade data that could indicate the health of global economies going into an earnings season.
