On Monday oil prices were higher on speculation that Eurozone leaders and Greece will finally achieve a deal to prevent the cash-strapped country from bankruptcy.
Brent crude for August delivery was 53 cents higher to trade at $63.55 a barrel by 7.30 a.m EDT, after falling nearly 2 per cent on Friday over worries about a potential Greek debt default, Reuters reported.
Prices recovered from early lows after the EU's generally positive response to Greek Prime Minister Alexis Tsipras's latest proposals to try to resolve the country's debt crisis ahead of a meeting of European leaders on Monday evening in Brussels.
Global stocks, the euro and peripheral euro zone bonds all rose today,
lifted by a wave of optimism on Greece.
"Hopes that agreement could be reached in the debt dispute with Greece at today’s EU summit are lending buoyancy to oil prices as the new week begins," Commerzbank analysts said in a note to clients.
However, gains are seen limited due to crude oil overhang, particularly in the Atlantic basin.
As Morgan Stanley said in a research note, despite strong summer demand, around 10 million barrels of unsold crude, mainly from Nigeria, are held in offshore storage. The bank potentially created a negative outlook for oil in the second half of the year.
Meanwhile, high oil production in the U.S., which has stood at around 9.6 million barrels a day, the highest since the early 1970s, continued to weigh on oil prices.
Last week, U.S. oil producers added a rig each in the key Permian and Bakken shale basins, spurring worries over high domestic oil output, even as the total number of active U.S. rigs fell last week, data on Friday showed.
Output "would continue to grow in 2016 by 150,000 barrels per day at the current rig count," though U.S. oil production was expected to fall slightly between the second and their quarters, Goldman Sachs said in a note.
