Oil prices held steady on Monday as Middle East risks eased while a possible OPEC+ output increase in August and uncertainty over the global demand outlook weighed on the market.

Brent crude futures were flat at $67.76 a barrel at 0918 GMT, ahead of the August contract’s expiry later on Monday. The more active September contract was up 17 cents at $66.97.

US West Texas Intermediate crude edged up by 9 cents, or 0.1 per cent, to $65.61 a barrel.

The Brent and WTI benchmarks posted their biggest weekly declines since March 2023 last week but are set for a second consecutive monthly gain of more than 5 per cent.

A 12-day war that started with Israel targeting Iran’s nuclear facilities on June 13 sent prices above $80 a barrel before sliding back to $67.

The market is back to a range-trading environment that is likely to continue until new economic growth concerns emerge or supply disruptions materialise, said UBS analyst Giovanni Staunovo.

Four OPEC+ sources told Reuters last week that the group was set to boost production by 411,000 barrels per day (bpd) in August after similar increases for May, June and July.

If OPEC opted for another output increase in August, global and OECD oil inventories would start swelling, potentially preventing any further upside in prices, PVM Associates analyst Tamas Varga said in a note.

The oil producer group is set to meet on July 6.

However, some market tightness remains despite rising output, with lower than expected production increases while exports from OPEC+ countries have remained stable, Staunovo added.

A Reuters survey found that OPEC oil output rose in May but gains were limited by cuts by countries that had previously exceeded their quotas while Saudi Arabia and the United Arab Emirates made smaller increases than allowed.

Bearish pressure is likely to persist on concerns over slower global oil demand, particularly from leading crude importer China, some analysts say.

Uncertainty around global growth continues to cap prices, said Priyanka Sachdeva, senior market analyst at Phillip Nova.