The West Texas Intermediate (WTI) for July delivery added 26 cents, or 0.2 percent, to settle at 120.93 U.S. dollars a barrel on the New York Mercantile Exchange. Brent crude for August delivery increased 26 cents, or 0.2 percent, to close at 122.27 dollars a barrel on the London ICE Futures Exchange.
The markets were volatile on Monday with the WTI hitting an intraday low of 117.47 dollars a barrel. The global standard traded as low as 118.95 dollars a barrel earlier in the session. Both benchmarks touched their lowest intraday levels since June 7.
Prices continued to garner support from tight supplies.
"We expect higher oil prices to be sustained, despite pledges from OPEC+ to step up production," analysts at UBS said in a note on Monday.
"With members of the group already struggling to meet existing production targets, we do not expect a significant increase in new barrels reaching the market," they said, adding the European Union's ban on Russian oil imports will also curb global crude supplies in coming months.
Meanwhile, a marked appreciation of the U.S. dollar was weighing on the market. The dollar index, which measures the greenback against six major peers, surged 0.89 percent to 105.0730 in late trading on Monday, following a 0.88-percent rise in the prior session. Historically, the price of oil is inversely related to the price of the U.S. dollar.
For the week ending Friday, the U.S. crude standard rose 1.5 percent, while Brent climbed 1.9 percent, based on the front-month contracts.
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