Oil prices dipped in early Asian trade on Monday as investors tread cautiously ahead of fresh economic data from top consumers the United States and China this week, while expected crude supply cuts from Saudi Arabia and Russia supported the market.

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Brent crude futures fell 22 cents, or 0.3 per cent, to $78.25 a barrel by 0107 GMT, and U.S. West Texas Intermediate crude was at $73.57 a barrel, down 29 cents, or 0.4 per cent.

"Oil traders may be cautious ahead of the U.S. CPI and China's slew of economic data later this week," CMC Markets analyst Tina Teng said.

However, crude prices could rebound after OPEC+ announced plans to further reduce supply, she said.

Both benchmarks gained more than 4 per cent last week to touch their highest marks since May, rising for a second straight week after the world's biggest oil exporters Saudi Arabia and Russia pledged to deepen supply cuts in August.

Saudi Arabia will extend its 1 million barrels per day (bpd) output cut into August and Russia will cut crude exports by 500,000 bpd. Instead of cutting output, Russia will be using the crude to produce more fuel to meet domestic demand, a government source told Reuters on Friday.

Saudi Arabia's cuts are easing its oil glut as floating storage off the Egyptian Red Sea port of Ain Sukhna, is down by almost half to 10.5 million barrels from mid-June, according to data from oil analytics firm Vortexa as of July 7.

Non-OPEC+ supply has been keeping up with global demand, JP Morgan analysts said in a note, adding that OPEC+ needs to deepen its cuts by another 700,000 bpd in the second half of the year on top of announced reductions and extend them into 2024.

In the Gulf, Iran's seizure of a supertanker managed by U.S. major Chevron (CVX.N) last week raised concerns about the threat to shipping in the region, including in the Strait of Hormuz.

In the U.S., Friday's data showed still-strong wage growth and a slight drop in the unemployment rate this week will likely keep the Federal Reserve on track to raise interest rates at the upcoming July meeting.

Money managers raised their net long U.S. crude futures and options positions in the week to July 3, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

A sustained break for WTI prices above $75 would likely see the benchmark testing the top of its eight-month $64-$84 range, IG analyst Tony Sycamore said.

U.S. oil rigs fell by five to 540 last week, lowest since April 2022, according to a Baker Hughes report on Friday.