LONDON: Oil prices were steady Monday after last week's rally, as traders reacted to renewed oversupply concerns spurred by an increase in US rigs output, analysts said.
Last week's gains lifted US benchmark West Texas Intermediate (WTI) above $40 for the first time since December, buoyed by a sharp drop in the dollar and revived optimism that producers would strike a deal to freeze output.
Around 1230 GMT on Monday, WTI for delivery in April was down 23 cents at $39.21 a barrel.
Brent North Sea crude for May delivery dropped 20 cents to $41.40 a barrel compared with Friday's close.
Analysts said US data had taken the steam out of recent sharp gains.
"The weekly rig count for the US reflected an increase for the first time after 12 weeks of cuts," said EY analyst Sanjeev Gupta.
The Baker Hughes weekly count of oil rigs operating in the United States rose by one after falling for more than two months running, while gas rigs dropped by five.
IG Markets market strategist Bernard Aw saw the price drop as a "knee-jerk reaction", adding that it was still unclear if US production will increase.
Qatar's energy minister Mohammed al-Sada last week said that exporters from within and outside the OPEC cartel would meet April 17 in Doha, stoking hopes of an agreement to ease a global supply glut.
The initiative is backed by 15 countries accounting for about 73 percent of worldwide output.
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