Oil prices extended losses into a second straight session on Tuesday on technical correction after last week's rally, while forecasts for ample supply and a firm dollar also weighed.

BEIJING

Brent futures fell 28 cents, or 0.37 percent, to $76.02 a barrel by 0148 GMT, while US West Texas Intermediate (WTI) crude fell 33 cents, or 0.45 percent, to settle at $73.23.

Both benchmarks rose for five days in a row last week and settled at their highest levels since October on Friday, partly due to expectations of more fiscal stimulus to revitalise China's faltering economy.

"This week's weakness is likely due to a technical correction, as traders react to softer economic data globally that undermines the optimism seen earlier," said Priyanka Sachdeva, senior market analyst at Phillip Nova, referring to bearish economic news from the US and Germany.

"Additionally, the dollar's strength is catching up with market sentiment and appears to be trimming the current gains in oil prices," Sachdeva said.

The US dollar wavered but remained close to the two-year peak it touched last week amid uncertainty around the extent of tariffs from the incoming Trump administration.

A stronger dollar makes oil more expensive for holders of other currencies.

Rising demand from non-OPEC countries, coupled with weak demand from China, are expected to keep the oil market well supplied next year, and that has also capped price gains.

"The move higher in crude oil prices appears to be running out of momentum," ING analysts wrote in a note.

"While there has been some tightening in the physical market, fundamentals through 2025 are still set to be comfortable, which should cap the upside."

Oil prices in 2025 are projected to experience modest declines compared to 2024, influenced by factors such as increased non-OPEC production and tempered global demand growth

The US Energy Information Administration (EIA) forecasts an average price of $79 per barrel for 2025, slightly below the 2024 average of $82 per barrel.

Projections suggest that WTI prices will remain below $70 per barrel in 2025, indicating a marginal decrease from 2024 levels.

A survey of analysts by Reuters poll indicates that US crude is projected to average $70.86 per barrel in 2025, with expectations of ample supply and moderated demand growth.

Reports show slower demand growth, particularly in key markets like China, is anticipated to temper price increases, while geopolitical tensions can introduce volatility.