Oil prices dipped in Asian trade Monday after the U.S. and Iran signaled continued nuclear negotiations, signaling reduced Middle East conflict risk. The dollar's resilience ahead of key U.S. economic data also pressured crude, following last week's 2% drop. April crude fell 0.7% to $67.57 a barrel, while West Texas Intermediate futures dropped 0.7% to $63.12. This cooling of regional tensions had been anticipated after Washington deployed warships, but trader risk premiums had previously spiked due to threats of military action. Tehran confirmed it will continue nuclear enrichment despite the talks.

US, Chinese economic data this week will be crucial. Key U.S. January data arrives Wednesday, followed by Friday's figures. China's January data, released Friday, will also impact oil demand forecasts as the country enters its Lunar New Year holiday, a period historically linked to increased fuel consumption. The focus remains on how these readings influence global oil demand and monetary policy expectations.

The dollar's strength and persistent demand for oil, despite geopolitical easing, kept prices under pressure. Traders now assess whether the nuclear talks can sustain this stability or if upcoming economic data will reignite volatility. Oil prices will remain sensitive to both diplomatic developments and U.S. economic indicators in the coming days.

Quick Fact: April crude fell 0.7% to $67.57 a barrel.