Oil prices were up slightly on Monday, helped by weaker US dollar and strong demand for crude.  Nexen photo.

US oil prices up almost 1 per cent

On Monday, slightly higher oil prices regained some of last week’s heavy losses as global equities calmed after their largest one-week decline in two years.

By 1:34 p.m. EST, benchmark Brent had risen by 31 cents to $63.10/barrel.  US West Texas Intermediate was up 53 cents to $59.73/barrel.  Earlier in the session, US crude hit a high of $60.83/barrel.

The Canadian Crude Index rose to $34.28.

The weaker US dollar was a factor in the rising prices, as it made greenback-priced crude cheaper for buyers using other currencies.

As well, the oil prices were supported by traders unwinding long positions last week, looking to regain some long footing early this week, John Macaluso, analyst at Tyche Capital Advisors told Reuters.

Macaluso added that early this week, the market will likely be driven by technical factors before fundamental inventory data from the US Energy Information Administration is reported on Wednesday.

“We’re two days away from EIA numbers, where we’re probably going to see another build,” he said.

Another factor bumping up oil prices is rising consumption and political, economic and social strife in Venezuela.

“Demand growth is very strong and, with (output) declines in places like Venezuela, is helping the situation. If demand stays strong, it still looks like OPEC will be in control in 2019,” SEB chief commodities strategist Bjarne Schieldrop told Reuters.

“If global growth does slow down and oil demand starts to slow, then production growth in the U.S. becomes a problem, because OPEC’s cake starts to shrink and that will be the line in the sand.”

According to the EIA, US crude production topped 10 million barrels per day (b/d), overtaking Saudi Arabia’s output and closing in on top producer Russia’s production.

On Friday, Baker Hughes reported that US drillers added 26 new oil rigs, raising the total number of oil rigs to 791, the highest since April 2015.

“We stick to our bearish view and see more downside for oil prices. The U.S. shale boom shows strong momentum and U.S. inventory levels are set to increase seasonally over the coming weeks as refineries go into maintenance, which should challenge the still-prevalent market tightening narrative at least temporarily,” Reuters reports Julius Baer head of macro and commodity research Norbert Ruecker said in a note.

Stephen Brennock, strategist at PVM Oil Associates said these are tough times for oil bulls.

“Positives may appear in short supply but, along with OPEC-led production curbs, buyers can take solace from a healthy global oil demand backdrop. Much of this is owing to China’s ravenous thirst for oil, which saw it surpass the U.S. to become the world’s largest crude importer in 2017,” he said.