Oil prices opened lower on Monday amid a rise in Covid-19 cases in China and a resurgent US dollar. Brent, the international marker, was down 1.41 per cent, trading at $55.20 per barrel at 3.05pm UAE time. West Texas Intermediate, which tracks US crude grades, was down 0.94 per cent at $51.75 per barrel. Oil prices, which surged nearly 10 per cent since the start of the year, softened their gains amid a spike in coronavirus cases in the Chinese province of Hebei. "The rise in fresh Covid-19 cases in China along with an ongoing rise in US 10-year yields are exerting downside pressure on oil prices," Vijay Valecha, chief investment officer at Century Financial in Dubai, said. US 10-year bond yields were up 20 per cent, and the US dollar also strengthened as the incoming Joe Biden administration promises to unlock fresh stimulus for the world's largest economy. Higher bond yields and a stronger US dollar are negatively correlated to the prices of crude. Gold, a safe-haven asset, also had one of its worst weeks since November after collapsing 2.6 per cent to $1,849 per ounce as higher bond yields weakened precious metals. The increase in Covid-19 cases in China is a concern as the country had been one of the few bright spots of recovery in the global economy. China has enforced lockdown measures across Hebei province to contain a fresh outbreak. The province, which has a population of 11 million people, registered 39 cases. The containment measures were quickly put in place as Hebei encircles the capital Beijing with a population of nearly 76 million. "The rise in coronavirus cases has made investors think twice about their oil positions. This is because there is no doubt that the coronavirus situation has gone out of control," Naeem Aslam, chief market analyst at Ava Trade, said. "The fact that China has also admitted that coronavirus cases have seen a surge is big news for the industry and for this reason, we see a significant pullback in oil prices," he added. Other analysts remained optimistic over the oil market's fundamentals. Despite the second wave of infections in the US and Europe, the medium-term oil demand outlook for crude "is increasingly positive amid vaccine progress that could break the link between infection and mobility", Ali Malik, senior investment adviser at the Bank of Singapore, said. The Asian bank has upgraded its 12-month forecast for Brent and WTI to $56 and $53 per barrel, respectively. The slowdown in oil comes a week after significant gains were prompted by progress in vaccination rollouts across the globe and a "commodities super cycle". Crude has benefitted the most from speculative trade in commodities. Data from Denmark’s Saxo Bank shows speculators hold net long positions on 24 major commodity futures of 2.5 million lots, which are worth $125 billion. The largest bets are held in crude with 614,000 lots in WTI and Brent, worth a nominal value of $30bn, the bank said on Sunday. Futures contracts for Brent traded lower to spot prices last week, but they nearly evened out during the opening session. The super cycle for commodities "might take a breather", Mr Valecha said. However, the cycle is unlikely to come to an end soon, he added. "The bullish sentiments on commodities are likely to sustain for a few more months. The weakness of the US dollar is playing a major role in this bull cycle and is expected to continue the same trend for the meantime."