Oil advances back toward US$100 with markets in risk-on mode

Oil rose back near US$100 a barrel, aided by a weaker dollar that put commodities broadly on a firmer footing.

West Texas Intermediate added as much as 3.1 per cent. European stock markets and US equity futures were higher on Monday. The dollar weakened -- making commodities priced in the currency more attractive -- as investors scaled back bets on how aggressively the Federal Reserve will tighten interest rates. Other raw materials including copper also gained. 

Last week President Biden concluded a trip to the Middle East and said he expects further oil supply increases from Saudi Arabia to help tame fuel costs. However, local ministers insisted that policy decisions would be taken according to market logic and within the OPEC+ coalition, a grouping that includes Russia.

Crude has slumped since mid-June as concerns about a potential recession ripped through commodity markets, eroding the gains that followed Russia’s invasion of Ukraine. While the drop has been a boost for the US administration, Biden remains eager to get the Organization of Petroleum Exporting Countries to add supplies to bring prices down further and help quell inflation. OPEC and its allies including Russia next meet on Aug. 3 after members agreed to revive the crude supplies that were halted during the coronavirus pandemic.