Oil rises amid supply concerns

Brent oil futures for November gained 0.4% to $67.26 a barrel, while West Texas Intermediate crude futures added 0.5% to $62.72 a barrel

Oil prices rose in Asian trade on Monday, extending mild gains from last week as traders watched for potential disruptions in Russian supply.

Focus this week is also on the U.S. central bank, which is widely expected to cut interest rates. The bank’s meeting comes amid growing concerns over weakening fuel demand in the country.

Brent oil futures for November gained 0.4% to $67.26 a barrel, while West Texas Intermediate crude futures added 0.5% to $62.72 a barrel by 02:15 GMT.

Focus is also on the U.S.’ attempts to deescalate the Russia-Ukraine war, although Moscow on Friday signalled that ceasefire talks with Ukraine had stalled.

The U.S. was last week seen seeking higher trade tariffs on China and India from the G7 countries, after Washington in late-August imposed 50% tariffs on India over its purchases of Russian oil.

More restrictions on the purchase of Russian oil may further limit global supplies, and appear likely with the war between Moscow and Kyiv showing few signs of ceasing.

Oil markets also took some support from a weaker dollar, as the U.S.’ currency dropped in anticipation of an interest rate cut by the central bank this week.

A raft of weak labour market readings and mixed inflation data ramped up bets that the bank had enough reason to resume its easing cycle from September.

Markets are pricing in a 96.4% chance the bank will cut rates by 25 basis points and a 3.6% chance of a 50 bps cut, CME Fedwatch showed.

Lower rates tend to boost economic activity and could help support oil demand in the coming months.

The dollar also weakened on the prospect of lower rates, helping spur gains across commodities that are priced in the currency.