International oil prices continued last week's upward trajectory and maintained their climb. On one hand, oil prices broke through key technical levels, further extending the rally; on the other hand, the Federal Reserve signaled a potential resumption of rate cuts, serving as a crucial catalyst for this oil price surge.

West Texas Intermediate (WTI) crude prices rose as much as 1.7%, reaching their highest level in nearly three weeks, while Brent crude prices broke through $68 per barrel. On Friday, Federal Reserve Chairman Jerome Powell indicated in his remarks that the Fed could potentially initiate rate cuts as early as the September policy meeting. Market expectations that rate cuts will boost the U.S. economy and drive crude oil demand contributed to the immediate rally in crude futures prices.

WTI crude prices broke through the 100-day moving average at approximately $64.45 per barrel, with this technical breakthrough also stimulating algorithmic traders' buying activity.

In other developments, Ukraine conducted overnight attacks on Russia's Ust-Luga port on the Baltic coast, marking the latest in a series of recent Ukrainian strikes targeting Russian energy infrastructure. Since the beginning of this month, Ukraine has attacked eight Russian refineries, raising market concerns about escalating fuel supply tensions.

However, long-term market sentiment remains subdued. Both major global oil forecasting agencies indicate that crude oil inventories may experience oversupply next year, prompting fund managers to reduce their bullish crude positions to approximately 17-year lows. Since early August, crude prices have remained within a narrow trading range, as traders seek balance between "bearish long-term outlook" and "multiple potentially bullish short-term geopolitical factors."

On one front, the United States threatens to double tariffs on all Indian imports to 50% in retaliation for India's purchases of Russian crude oil. Although the tariffs are set to take effect Wednesday, Indian diplomats indicate that domestic refineries will continue importing Russian crude.

On another front, OPEC+ decided to restart most idle capacity, raising market concerns about potential oversupply. Current crude futures prices have declined approximately 11% from the beginning of the year.

Currently, Brent crude futures are trading below Dubai crude (its regional benchmark counterpart) in a rare occurrence, and this price differential shift may intensify market concerns about expanding crude oversupply. Despite OPEC+ increasing daily production by millions of barrels, the inverted spread between Brent and Dubai crude (a trend that has been developing for months) highlights that supply-demand balance conditions in Brent crude's primary pricing region—the Atlantic Basin—continue to weaken relative to the Middle East.

Monday's Brent crude futures trading volume fell below daily averages, partly due to the UK public holiday with many traders away from the market.