US oil rides weak dollar higher, but Brent slips on China's woes


U.S. oil prices rose on Monday as a weak U.S. dollar prompted buying, while Brent prices fell as concerns about China's slowing economy dragged global equities down and outweighed low Libyan output.

The U.S. dollar fell to its lowest in more than three months against the yen, making dollar-denominated commodities cheaper for buyers using the Japanese currency. Shanghai shares hit a three-week low and European equities slumped after data on Sunday showed growth in average new home prices in China slowed to a near one-year low in April.

Meanwhile, Libya's major western oilfields, El Sharara and El Feel, remained shut a week after the government said it reached a deal with protesters to reopen them. National output has been capped at 210,000 barrels per day (bpd), far below the 1.4 million bpd produced until mid-2013.

Source: Denver International Airport

U.S. crude for June delivery rose 59 cents to settle at $102.61 a barrel, as the contract traded in light volume ahead of its expiration on Tuesday. Brent crude lost early gains, trading 30 cents lower near $109 a barrel, having climbed to an earlier intra-session high of $110.33 a barrel on the violence in Libya.

The conflict in Ukraine kept supporting oil, as U.S. President Barack Obama and French President Francois Hollande said Russia faced significant costs if it continues "provocative and destabilizing behavior".

Russian President Vladimir Putin ordered military forces to return to permanent bases after drills near Ukraine, the Kremlin said, although the Pentagon said it saw no indication of Russian troop movement away from the border.

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