Brent crude futures fell by 39 cents, or 0.4 per cent to $98.18 a barrel. U.S.

West Texas Intermediate crude fell by 47 cents, or 0.51 per cent, to $92.14.

Both contracts dropped by more than $1 a barrel earlier in the session after Chinese health officials at the weekend reiterated their commitment to strict COVID containment measures, dashing hopes of a rebound in oil demand from the world’s top crude importer.

Brent and WTI rose last week, climbing 2.9 per cent and 5.4 per cent, respectively on speculation about a possible end to COVID-19 lockdowns despite the lack of any announced changes.

However, prices pared gains on stronger risk sentiment, news of recovering Chinese crude imports and the U.S. dollar weakening against other currencies, UBS analyst Giovanni Staunovo said.

Both contracts remain well above $90 a barrel, with Brent hovering nearer $100.

The U.S. dollar sank against the euro on Monday and sterling was supported by risk-on sentiment and a rally in European stock markets.

While China’s imports and exports contracted unexpectedly in October, its crude oil imports rebounded to the highest level since May.

Oil prices have also been underpinned by expectations of tighter supplies when the European Union’s embargo on Russia’s seaborne crude exports starts on December 5, even though refineries worldwide are ramping up output.

U.S. oil refiners this quarter will run their plants at breakneck rates, near or above 90 per cent of capacity. China’s largest private refiner Zhejiang Petroleum and Chemical Co (ZPC), meanwhile, is raising diesel output.

Kuwait Integrated Petroleum Industries Co (KIPIC) said on Sunday that the first phase of its Al Zour refinery has started commercial operations, the KUNA state news agency reported.