Brent crude climbed toward $99 a barrel on Monday as failed labour talks in Norway stoked worries of a total output shutdown, while hopes China would ease monetary policy and improve fuel demand also supported prices.
Data from top energy consumer China showed annual consumer inflation cooling further in June, leaving room for Beijing to ease policy without stoking upward price pressures and helping most commodities recover from steep losses triggered by bleak U.S. jobs data in the previous session.
"We need to bear in mind that China does have its growth target," said Michael Creed, economist at the National Australian Bank. "I do imagine they will do anything policy wise to achieve that. If they do, it will support oil prices."
Brent rose 62 cents to $98.81 a barrel by 0403 GMT after settling up a slight 0.4 percent last week in choppy trade supported by supply disruption fears from the Norway oil workers' strike and a launch of tough Western sanctions targeting Iranian crude exports.
U.S. crude was up 45 cents to $84.90 after falling 0.6 percent last week as tepid jobs growth in the United States dragged down global markets on Friday.
But investors were far from making aggressive bets amid growing evidence of a shaky global economy, remaining cautious ahead of China's GDP data which is scheduled for later this week and likely to show its weakest expansion in three years. ID:nL6E8I630Y]
Slower economic growth in China and the United States amid the euro zone debt crisis led Brent to post a 20 percent fall in the second quarter, the largest three-month loss since the 2008 financial crisis.
"It's the emerging economies which have been the catalyst for the oil price's strength over the years," Creed said.
Premier Wen Jiabao said on Sunday that China needs to aggressively fine-tune its economic policies to support its economy. In March, Wen cut the 2012 growth target to 7.5 percent, which would be the lowest since 1990.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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