LONDON: Oil prices hit one-month lows as prospects of Middle East producers agreeing to curb chronic oversupply faded, and other commodities also lost ground as the dollar stabilised after Friday's strong U.S. data.

Brent crude, the international benchmark, traded down 36 cents a barrel at $38.31, having fallen as far as $38.18, its lowest since March 4.

Prices have fallen from highs above $100 a barrel since mid-2014 on a supply glut. Brent topped $42.50 last month in anticipation of agreement among producers to freeze output. However, such steps look increasingly unlikely.

Last week a Saudi prince reportedly said the kingdom would only freeze output if Iran and other producers did the same. Iranian Oil Minister Bijan Zanganeh was quoted as saying at the weekend that his country would increase production and exports until it reached the position it occupied before sanctions were imposed over its nuclear programme.

"Macroeconomic concerns and high petroleum inventories are the oil market's ball and chain and are likely to keep the oil price between the mid-$30s and low $40s in Q2," Barclays said.

Copper prices, which are also sensitive to the value of the dollar, hit a one-month low of $4,778 a tonne on the U.S. data and concern about Chinese demand before recovering slightly to $4,790.

Gold fell for the second successive day, dropping about 0.4 percent to $1,217 an ounce.

The pan-European FTSEurofirst 300 share index rose 0.2 percent. It opened lower on a fall in telecoms stocks after the collapse on Friday of tie-up talks between Orange and Bouygues.

Britain's FTSE 100 index also rose 0.2 percent.

MSCI's broadest index of Asia-Pacific shares outside Japan earlier rose 0.1 percent, although many of its components were not traded due to a holiday in Greater China.

Japan's Nikkei fell 0.3 percent, led by a fall in automakers following poor U.S. sales figures.

The dollar rose 0.1 percent against a basket of major currencies but fell 0.1 percent to 111.60 yen. The euro dipped 0.1 percent to $1.1370.

The impact of a report on Friday showing the U.S. economy added 215,000 jobs last month and another showing U.S. factory activity expanded in March for the first time in six months was offset by Federal Reserve Chair Janet Yellen saying last week the central bank would proceed cautiously in raising rates.

"Yellen sent some very powerful messages last week so the extent of dollar strength on payrolls was limited," said BMO Capital Markets currency strategist Stephen Gallo.


U.S. Treasury yields, which rose on Friday after the economic numbers, turned lower on Monday. Ten-year yields were down 2.4 basis points at 1.77 percent, compared with 1.79 percent at Friday's New York close.

German 10-year bond yields, the benchmark for euro zone borrowing costs, dipped 0.5 bps to 0.14 percent.

Some analysts expect the 10-year yields to test zero again, as they did a year ago, as the European Central Bank has increased its monthly purchases of assets, including Bunds, to 80 billion euros from 60 billion.

"The main driving force is the ECB's increased amount of public sector asset purchases and there's a very favourable supply-demand imbalance this month," RIA Capital Markets bond strategist Nick Stamenkovic said.