Oil prices rose 1% on Monday morning on a weaker dollar, though U.S. drilling increase raises concerns that the oil oversupply in the market remains despite OPEC‘s cuts.
Brent crude futures traded higher 45 cents, or 1.0%, at $45.99 a barrel. WTI crude futures rose 43 cents, or 1.0%, at $43.44 a barrel.
Analysts think that oil prices continued to rise as investors covered short positions and there was little fundamental news supporting prices.
On Monday, U.S. dollar remains low against a basket of currencies, which was caused by the fading expectation for the Fed to increase interest rates later this year. A weak dollar makes oil cheaper for countries using other currencies.
"Commodities have stabilized after a complicated week when most sectors suffered heavy losses," said ANZ Bank in a statement. "A weak U.S. dollar helped increase investors interest."
Although oil prices rebounded from 10-month lows, they are still lowered around 13% since the end of May.