LONDON—Oil prices jumped by more than $3 on supply concerns on Monday.
Brent crude futures rebounded $3.37, or 4 percent, to $88.51 a barrel by 1100 GMT. U.S. West Texas Intermediate crude was up 4.1 percent, or $3.29, at $82.78.
Oil prices have tumbled for four straight months since June, as COVID-19 lockdowns in top energy consumer China hurt demand while rising interest rates and a surging U.S. dollar weighed on global financial markets.
“The two biggest question marks are the demand outlook (especially in China) and what happens to Russian supply after the EU ban goes into effect on Dec. 5.”
While prompt Brent prices could strengthen further in the immediate short term, concerns over a global recession are likely to limit the upside, consultancy FGE said.
“If OPEC+ does decide to cut output in the near term, the resultant increase in OPEC+ spare capacity will likely put more downward pressure on long-dated prices,” it said in a note on Friday.
The dollar index fell for a fourth consecutive day on Monday after touching its highest in two decades. A cheaper dollar could bolster oil demand and support prices.
