Oil prices rose by more than 1% on Monday after OPEC's monthly market report eased worries about waning demand in the United States and China.

Brent crude futures rose by a dollar, or 1.2%, at $82.43 a barrel by 1:21 p.m. ET (1821 GMT). U.S. West Texas Intermediate (WTI) crude futures were also up a dollar, or 1.3%, at $78.17 per barrel.

In a monthly report, OPEC said oil market fundamentals remained strong and blamed speculators for a drop in prices. OPEC made a slight increase to its 2023 forecast for global oil demand growth and stuck to its relatively high 2024 prediction.

"The OPEC monthly oil market report appeared to push back against demand concerns, referencing overblown negative sentiment around Chinese demand while raising demand growth forecasts for this year and leaving them unchanged for next," Craig Erlam, senior market analyst at OANDA, said in a note.

The U.S. Energy Information Administration (EIA) said last week the country's crude oil production this year will rise by slightly less than previously expected and that demand will fall.

Also, Federal Reserve Chair Jerome Powell said last week the central bank could raise interest rates again, which fed worries about the oil demand outlook.

Weak economic data last week from China, the world's biggest crude oil importer, also raised fears of faltering demand. Chinese refiners asked for less supply for December from Saudi Arabia, the world's largest exporter.

Still, oil prices may have found a bottom after they slid about 4% last week and recorded their first three-week declining streak since May, said Fawad Razaqzada, an analyst at City Index.

"Given that oil prices have weakened in the last few weeks, Saudi Arabia and Russia will likely continue with their voluntary supply cuts into next year. This should therefore limit the downside potential," Razaqzada said.

 

Last week, top oil exporters Saudi Arabia and Russia, part of the group known as OPEC+, confirmed they would continue with additional voluntary oil output cuts until the end of the year as concerns over demand and economic growth continue to drag on crude markets.