The NYMEX February crude contract broke out of a narrow trading band immediately ahead of the 1:15 p.m. EST (1815 GMT) cessation of trading on the NYMEX contract to end the day 9 cents lower at $95.47/b.
Prior to 12:30 p.m. EST (1730 pm), the contract was tightly rangebound between $95.05/b and 95.36/b.
ICE March Brent was 15 cents lower at $111.74/b at 1:15 p.m. EST, after hitting a low of $111.41/b and a high of $111.99/b overnight.
Trading volume on both contracts remained thin Monday, with much of the US market closed in observance of the Martin Luther King Jr. holiday; total volume on the NYMEX crude contract was 50,372 lots, its lowest level since November 24, 2011.
Market-moving news was difficult to come by Monday, with few macroeconomic indications scheduled for the day and US news largely on-hold due to the combination of the holiday and President Barack Obama's second inaugural ceremony in Washington.
The forceful end to the Algerian hostage crisis over the weekend helped dampen the geopolitical risk premium analysts said, though ongoing unrest in North Africa could prompt a resurgence in concern over possible supply disruptions in the oil and gas-rich region.
Algerian special forces stormed the gas plant in the In Amenas gas field in eastern Algeria over the weekend, ending a four-day hostage situation that started Wednesday when the plant was attacked by Islamist militants.
Algeria's Prime Minister Abdelmalek Sellal said Monday that 37 foreign workers and one Algerian died during the siege of the complex, though the casualty toll remains provisional.
Recent favorable economic data out of both China and the US was helping to add upside pressure to crude sentiment, analysts said, though the lack of fresh macroeconomic indicators Monday in addition to thin trading, kept movement muted.
"It's really just reinforcing market fundamentals," Miswin Mahesh, commodities analyst at Barclays Capital, said.
ICE March Brent's premium to NYMEX March crude bounced above $16/b briefly during Europe trade Monday, before consolidating around $15.90/b.
"The currently record-high stocks at Cushing could decline more slowly than expected, as many refineries in the Midwest and on the US Gulf Coast are planning to undertake extensive maintenance work," analysts from Commerzbank said in a note.
The US Energy Information administration is scheduled to release its weekly inventory data on Thursday, one day later than normal due to the US public holiday. It is the first report expected to show the impact of the Seaway Pipeline expansion on crude stocks in Cushing, Oklahoma.
Seaway reopened on January 11 after undergoing an upgrade that increased capacity from 150,000 b/d to 400,000 b/d. The US EIA showed a 1.8 million-barrel build in stocks at Cushing over the week ending January 11, bringing total stocks in the region to a fresh, record high of 51.9 million barrels.
DISTILLATES EXTEND GAINS IN AFTERNOON TRADE ON COLD WEATHER
Distillate markets held on to gains during late Europe trade as cold weather in the Atlantic basin continued to impact heating and gasoil prices.
At 1:15 p.m. EST, NYMEX February heating oil was up 2.10 cents at $3.0735/gal, despite weaker crude markets, while ICE February gasoil was $12.50/mt higher at $968.25/mt, though trading activity on both contracts was muted.
"It's a winter market," Olivier Jakob, oil analyst at PetroMatrix, said. "Backwardation is really steep [in the ICE gasoil contract], but the [physical] differentials aren't as strong if you look at the diesel or German 50 ppm premiums."
NYMEX February RBOB was 7 points higher at $2.7975/gal. At 18,789 lots, volume on the NYMEX RBOB contract was at its lowest level since November 24, 2011.