Brent crude futures slid 3 cents to $85.21 a barrel, after settling down 0.6% on Friday, and U.S. WTI crude futures were at $80.71 a barrel, down 2 cents

Oil prices dropped on Monday as concerns of higher-for-longer interest rates renewed and pushed the dollar, offsetting support for oil markets from geopolitical tensions and OPEC+ supply cuts.

Brent crude futures slid 3 cents to $85.21 a barrel by 0632 GMT, after settling down 0.6% on Friday. U.S. WTI crude futures were at $80.71 a barrel, down 2 cents.

The U.S. dollar has opened bid this morning and seems to have broken higher following better U.S. PMI data on Friday night and political concerns ahead of the French election, according to Tony Sycamore, a Sydney-based markets analyst at IG.

A stronger greenback makes dollar-denominated commodities less attractive for other currency holders.

The dollar index, which measures the greenback against six major currencies, jumped on Friday and was slightly higher on Monday after PMI data showed U.S. business activity was at a 26-month high in June.

Nevertheless, both benchmark crude contracts added almost 3% last week on signs of stronger oil products demand in the U.S., world’s biggest consumer, and as OPEC+ cuts kept supply in check.

U.S. crude inventories dropped while gasoline demand increased for the seventh consecutive week and jet fuel consumption has returned to 2019 levels, ANZ analysts stated in a note.

ING analysts led by Warren Patterson said speculators have also become more constructive towards oil into summer and raised their net-long positions in ICE Brent.

We remain supportive towards the oil market with a deficit over the third quarter set to tighten the oil balance, according to the analysts.

In Ecuador, state oil company Petroecuador has declared force majeure over deliveries of Napo heavy crude for exports after the shutdown of a key pipeline and oil wells due to heavy rains, sources said on Friday.