Brent crude rose above $118 on Monday, supported by a weaker dollar and expectations of a revival in demand growth after Greek lawmakers approved an austerity bill to secure a second bailout.
Financial markets, from Asian shares and base metals to gold, all rose as the Greek parliament approved the bill. But investors still remain wary the violence that spread across the country may deepen the crisis as Athens still needs to announce further spending cuts.
Front-month Brent crude rose more than $1 to $118.35 and traded at $118.24 by 0316 GMT. The benchmark gained 2.38 percent last week, posting its third straight weekly rise. U.S. crude was up 89 cents at $99.56 a barrel.
"Oil has been trading in a tight range for the past couple of weeks and we're now moving towards the higher end of the range," said Victor Shum, senior partner at oil consultancy Purvin & Gertz. "I don't expect we're going to rally ahead in a big way...with protests raging everywhere in the country, it's not exactly an image of confidence."
The dollar index fell 28 cents to $79.11. A weaker U.S. currency can lift dollar-denominated oil by making the commodity cheaper for consumers using other currencies.
The rebellion and street violence foreshadowed the problems Greece faces in implementing the cuts, which include a reduction of 22 percent in the minimum wage -- a package critics say condemns the economy to an ever-deeper downward spiral.
Greece needs the international funds before March 20 to meet debt repayments of 14.5 billion euros, or suffer a chaotic default, which could spread across the entire euro zone.
Gains were also capped by concerns demand growth would slow this year because of an overall weak global economy. The International Energy Agency (IEA) reduced its forecast for growth last week, in its sixth consecutive monthly report, by 250,000 barrels per day (bpd) to 800,000 bpd.
The IEA's view followed monthly reports from OPEC and the U.S. Energy Information Administration, with OPEC lowering its demand growth forecast because of economic weakness in Europe and the United States. The EIA raised its expectations, by only 50,000 bpd, the first boost since October.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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