Oil futures were higher Monday as NYMEX crude built a solid cushion above $40/b on short-covering and speculation that OPEC members were lobbying for the implementation of a production freeze.

NYMEX September crude settled $1.22 higher at $43.02/b. ICE October Brent settled up $1.12 at $45.39/b.

NYMEX September ULSD settled 2.66 cents higher at $1.3436/gal. NYMEX September RBOB settled 1.43 cents lower at $1.3620/gal.

Traders who bet on further price declines could be trying to exit positions, which could put a floor under oil prices, analysts said.

Money managers' short position in NYMEX crude jumped 36,938 contracts to 227,763 contracts in the week that ended August 2, according to US Commodity Futures Trading Commission data released Friday.

"Those new position holders look like they jumped on the bandwagon at exactly the wrong time, as we've witnessed an 8% rally since [August 2]," TAC Energy said in a note.

"That reaction suggests that the rally over the past four sessions could be the start of a short squeeze. That type of a rally is notoriously volatile as speculators, who are often leveraged, race to the exits," it said.

From a technical perspective, oil market participants were tracking NYMEX crude's 100-day moving average, which stood Monday at $44.60/b. A break above this level could provide more upside momentum, analysts say.

NYMEX RBOB was the weakest element in the oil complex, coming under pressure from reports that BP had restarted units at its 430,000 b/d refinery in Whiting, Indiana.

BP shut a 65,000 b/d reformer at the refinery over the weekend of July 29, and had tried restarting the unit, but there was an upset at the facility's wastewater treatment plant, a source said.

Profit-taking contributed to NYMEX RBOB's weakness Monday, according to Jim Ritterbusch, president of Ritterbusch & Associates.

"There was some unwinding of spreads taking place," he said.

Traders may have exited long positions in the RBOB/ULSD spread and RBOB crack spread, which would necessitate selling RBOB futures, Ritterbusch said. The Wall Street Journal reported last week that several OPEC members are rekindling an effort to place limits on production, although analysts have expressed skepticism about the likelihood of such a move succeeding.

OPEC members are scheduled to meet informally during the International Energy Forum held in Algeria September 26 through 28.

OPEC members pumped 33.12 million b/d in July, up 170,000 b/d from a month earlier, according to an S&P Global Platts survey.

China's oil product exports hit record highs in July, increasing more than 50% year on year, according to preliminary data that the General Administration of Customs released Monday.

The country's oil product exports equaled 4.57 million mt in July, topping the previous high of 4.32 million mt in December 2015.

"The surge in product exports has been boosted by the granting of export licenses to smaller refineries and is a key factor in putting downward pressure on regional product margins in recent months," Barclays analysts said in a research note.

--Geoffrey Craig, geoffrey.craig@spglobal.com

--Edited by Keiron Greenhalgh, keiron.greenhalgh@spglobal.com

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