There was notably choppy trading in oil during US trading on Friday with wider fluctuations across asset classes helping to increase volatility.
The weaker dollar provided net support to oil prices with 10-day highs around the $46.70 p/b area as the US currency index declined to 10-month lows.
The latest Baker Hughes data recorded a small increase in oil drilling rigs to 765 for the latest week from 763 previously, although there was some evidence of a decline in the number of rigs in higher-cost fields which suggests that lower oil prices may be having an impact in curbing development.
The latest COT data recorded a small increase in net, long non-commercial oil positions in the latest week to 358,000. This was the second successive increase and highest level for four weeks.
The data will maintain concerns that rallied in oil prices could fade quickly as positions are scaled back quickly again.
Prices maintained a firm tone in Asia on Monday before dipping to the $46.50 p/b area in Europe.
There was underlying price support from expectations that demand would strengthen during the second half of 2017.
Stronger than expected Chinese industrial production data increased confidence that global demand would strengthen, especially with Chinese refiners increasing output to the second highest level on record in June.
Domestic Chinese crude production also declined 5.1% in the first half of 2017, maintaining expectations of higher imports to meet demand.
On the supply side, disruption to Nigerian output with the closure of a key pipeline also supported sentiment.
Overall, WTI consolidated just below $46.50 p/b at the US open with Brent holding below $49.00.
Dollar vulnerability will tend to underpin prices and markets will be looking ahead to the latest round of inventory data. Another strong draw this week would be important in boosting overall sentiment.
WTI Oil Price 4-Hour Chart