SINGAPORE (Dow Jones)--Crude oil futures were steady in Asia trade Monday, holding above last week's close amid mixed Asian equities as the dollar weakened slightly from strong gains made Friday.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in January traded at $75.83 a barrel at 0645 GMT, up 36 cents in the Globex electronic session. January Brent crude on London's ICE Futures exchange rose 52 cents to $78.04 a barrel.
Oil futures settled down near a two-month low Friday as the dollar surged against major currencies after a bullish U.S. employment report fueled expectations of an interest rate hike tracking a stronger U.S. economy.
"There isn't a massive amount of downside from here, but the upside is also capped. The dollar won't be enough to push crude out of its current trading range," said Yingxi Yu at Barclays Capital.
Crude has been supported by a weaker # dollar and stronger equities this year, while the market awaits economic recovery and oil demand to catch up. But Friday's fall in oil futures highlighted crude's susceptibility to a stronger dollar, even as demand continues to be weak.
"As far as this week goes, a resurgent dollar will spell further weakness for crude, doubly so if gold gives up its spectacular gains," said Stephen Schork in The Schork Report.
While favorable employment news usually pushes up gasoline demand, "the much larger item that traders are factoring in is the potential dollar strength that could diminish oil's attractiveness as an asset class," said Jim Ritterbusch of Ritterbusch and Associates.
Crude may lean to the lower end of the $72-$78 range this week as record levels of stockpiles continue to weigh on demand and spare OPEC capacity continues to threaten more supply into the market if prices rise, said Mike Sander of Sander Capital Advisors.
"If the dollar drops more and more it will put pressure on oil to go higher, but at the same time OPEC can still add to their output to try and lower prices," he said.
Nymex reformulated gasoline blendstock for January rose 38 points to 197.88 cents a gallon, while January heating oil traded at 204.05 cents, 137 points higher.
ICE gasoil for # December changed hands at $618.25 a metric ton, down $3.50 from Friday's settlement.
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