© Reuters. FILE PHOTO: Oil rig pumpjacks, also known as thirsty birds, extract crude from the Wilmington Field oil deposits area near Long Beach, California July 30, 2013. REUTERS/David McNew/File Photo

By Noah Browning

LONDON (Reuters) – Oil prices fell on Monday, extending losses on market views that higher than expected inflation could delay cuts to high interest rates that have been capping growth in global fuel demand.

futures fell 46 cents, or 0.6%, to $81.16 a barrel by 1210 GMT. U.S. West Texas Intermediate crude futures (WTI) were down 40 cents, or 0.5%, at $76.09.

The dip extended losses registered last week, when Brent lost about 2% and WTI fell more than 3% on signs that the U.S. Federal Reserve is in no rush to cut interest rates.

“With inflation stubbornly hovering well above the Fed’s 2% target and the U.S. economy showing a resilience few had predicted, the markets moved to price in a scenario where interest rates remain high for longer,” said ActivTrades senior analyst Ricardo Evangelista.

Oil prices have been trading between $70 and $90 a barrel since November as rising U.S. supply and concern over weak Chinese demand offset OPEC+ supply cuts despite two wars raging in Ukraine and Gaza.

As the Israel-Hamas conflict continues in the Middle East, White House national security adviser Jake Sullivan told CNN on Sunday that negotiators for the United States, Egypt, Qatar and Israel had agreed on the basic contours of a hostage deal during talks in Paris but are still in negotiations.

The geopolitical risk premium on Brent crude from by Yemeni Houthis on ships in the Red Sea remained modest at only a $2 a barrel, Goldman Sachs analysts said in a note.

However, the bank has raised its summer peak price projection to $87 a barrel, up from $85, after Red Sea disruptions have driven larger than expected draws in stocks held by developed countries.

Goldman Sachs still expects oil demand to grow by 1.5 million barrels per day (bpd) in 2024 but has cut its forecast for China while raising projections for the United States and India.