Oil falls on caution ahead of econ data, offsets trade deal optimism

Oil prices eased on Monday as traders took profit ahead of fresh European and US economic data, despite hopes for some resolution to the US-China trade row that has hurt global economic growth and crimped energy demand.

Prices jumped about $2 a barrel on Friday after the world's top two economies said they had made progress on trade talks while US officials said the deal could be signed this month.

Brent crude futures for January fell 31 cents to $61.38 a barrel by 0406 GMT, while December US crude futures was at $55.91 a barrel, down 29 cents.

"Friday's mega-rally was built on a combination of not-as-bad-as-feared data and optimism on a trade deal that really, only keeps the lights on. It does not increase the brightness of the world economy," Jeffrey Halley, a Singapore-based senior market analyst for Asia Pacific at OANDA, wrote in a note.

The European Union and the United States are set to announce manufacturing data on Monday with more US and Chinese data to come later in the week.

"I think the trade talk continues to improve sentiment but ... Asian oil traders want more convincing data from the macros side" before supporting oil, Stephen Innes, Asia Pacific market strategist at AxiTrader, said.