Oil prices have increased after charting a recovery course on Monday on the back of stability in global stock markets, as well as a weaker dollar.
The recovery comes after oil prices suffered a steep fall last week as a result of volatility in financial markets triggered by a global sell-off.
Brent crude futures registered a growth of 38 cents, or 0.6%, to trade at $62.97 per barrel, while US West Texas Intermediate (WTI) crude futures rose 31 cents, or 0.5%, to reach $59.60, according to Reuters.
Futures brokerage Oanda Asia-Pacific head Stephen Innes was quoted by the news agency as saying: “Oil markets attempted a half-hearted recovery overnight on little more than an equity market correlated bounce, and indeed the weaker US dollar added to the momentum.”
Analysts opined that a weaker dollar is likely to drive global oil consumption.
Traders are now closely monitoring crude inventory levels as data from the American Petroleum Institute (API) and the US Energy Information Administration (EIA) is due next week.
Meanwhile, the Organisation of the Petroleum Exporting Countries (OPEC) expects global oil demand to climb by 1.59 million barrels per day (bpd) this year, reaching 98.6 million bpd.
OPEC also expects production from the US and other regions to increase supply by 1.4 million bpd this year, a rise of 250,000bpd from last month.
Since January last year, the OPEC and other producers such as Russia have been voluntarily enforcing output cuts to tighten markets.