U.S. crude were slightly higher in volatile trade on Monday, after weakening on concerns that a rally that had sent price to their highest since December 2014 had run out of steam.
Speculators currently have a record net-long position on the market, with bullish bets outweighing bearish ones.
"At these levels, the market requires a steady drumbeat of positive information, and without that, its hard to attract new longs to the market," said Gene McGillian, director of market research at Tradition Energy.
U.S. crude ended Monday's session up 25 cents at $63.62, having also hit its highest since December 2014 last week.
was up 24 cents at $68.85 a barrel by 2:06 p.m. ET. Brent had hit $70.37 on Jan. 15, the highest since December 2014.
The dollar index, which measures the greenback against six rival currencies retreated to near a three-year low, but pared losses as the U.S. government shutdown appeared poised to end.
Earlier in the day, resumption of output from Libya's As-Sarah fields weighed on the market.
"The downside might be limited but last week's highs are unlikely to be penetrated unless there is a significant bullish change on the supply front," PVM analyst Tamas Varga said in a report.
Production at As-Sarah resumed on Sunday and was expected to add 55,000 barrels per day by Monday.
Brent is particularly sensitive to changes in output from Libya, as most Libyan crude is priced against Brent.
Saudi Energy Minister Khalid al-Falih said rebalancing the market might not take place until 2019, suggesting it would take longer than OPEC has previously indicated.
Global economic growth was also helping prices by driving up demand.
"Global growth has become synchronised and accelerated above trend," U.S. bank Morgan Stanley said in a note.
Bernstein Energy said oil inventories might start rising soon due to a slowdown in demand that typically happens at the end of the northern hemisphere winter.
"With the strong correlation between inventories and crude prices, this perhaps means we should expect crude prices to moderate in the near term," Bernstein said.
But a drop in the number of U.S. drilling rigs, an indicator of future output, offered some support. U.S. drillers cut five rigs in the week to Jan. 19, reducing the count to 747.
Despite the cuts, the rig count in 2017 and early this year remains much higher than in 2016, resulting in a 16-percent rise in U.S. crude oil production since mid-2016, to 9.75 million barrels per day (bpd).