Oil prices fell in early Asian trading on Monday, extending losses from the previous session after crude ended the week down 2-3 percent amid market concerns that higher-than-expected inflation could delay a U.S. interest rate cut.
Brent crude futures were down 34 cents at $81.28 a barrel by 0121 GMT. U.S. West Texas Intermediate (WTI) crude futures were down 33 cents at $76.16.
Crude oil prices fell due to the lack of fresh catalysts, analysts at ANZ Bank said in a note. Oil was caught between bullish factors such as lower OPEC production and rising geopolitical risks and negative concerns about weak demand in China.
While the Houthis in Yemen continue their attacks on ships in the Red Sea, the war between Israel and Hamas has not significantly restricted oil supplies.
The morning decline built on losses last week, when Brent crude fell about 2 percent and U.S. West Texas Intermediate crude fell more than 3 percent on signs that a U.S. interest rate cut could be delayed for two months due to rising inflation.
ANZ analysts expect oil inventories to start falling in the coming weeks as refineries resume operations after maintenance, which could provide some support to prices.
The U.S. Energy Information Administration said last week that crude inventories rose by 3.5 million barrels to 442.9 million barrels in the week to Feb. 16. Analysts polled by Reuters had forecast a 3.9 million-barrel increase.
