Oil prices held steady near $100 a barrel on Monday as support from a weaker dollar and a recovery in Chinese crude oil imports countered renewed demand concerns stemming from China's tough approach to containing Covid.

 

Brent oil futures fell 7 cents, or 0.05%, to $98.52 a barrel. US West Texas Intermediate crude was $92.46 a barrel, down 15 cents, or 0.2%.

 

Both contracts fell more than $1 a barrel early in the session as Chinese health officials reaffirmed their commitment to a strict approach to containing Covid over the weekend, dashing hopes for a recovery in oil demand from the world's largest oil importer.

 

Brent and WTI rose last week, gaining 2.9% and 5.4% respectively on speculation that the Covid-19 lockdowns could end despite no announced changes.

 

But prices cut losses in early European trade after stronger risk sentiment, news of a rebound in Chinese crude oil imports and a weaker US dollar against other currencies, UBS analyst Giovanni Staunovo said.

 

The US dollar slipped against the euro on Monday, while the pound sterling was supported by sentiment risk and a rally in European stock markets.

 

While China's imports and exports fell unexpectedly in October, crude oil imports rose to their highest level since May.

 

Oil prices are supported by supply cut expectations as the European Union embargo on Russian oil exports by sea comes into effect on December 5, despite refineries around the world ramping up production.

 

US refineries will be operating their refineries at breakneck speeds near or above 90% capacity this quarter. China's largest private refinery Zhejiang Petroleum and Chemical Co (ZPC) ramps up diesel production.

 

Kuwait Integrated Petroleum Industries Co (KIPIC) said on Sunday that the first phase of the Al Zur refinery has entered commercial operation, the state news agency reported.