Oil prices rose above $74 a barrel in thin trade on Monday as worries about euro zone economic stability fuelled the worst monthly loss for the commodity since December 2008.
US crude for July delivery rose 34 cents to $74.31 by 0443 GMT, after settling down 58 cents on Friday, when a downgrade of Spain's credit ratings and disappointing US economic data fuelled investor caution about riskier assets like oil.
Front-month crude fell $12.18, or 14.1 per cent, in the month of May, the biggest monthly percentage loss since December, 2008, when prices fell 18.1 per cent.
London Brent crude rose 39 cents to $74.41 a barrel. Front-month Brent crude was down $13.42, or 15.4 per cent for the month, the biggest monthly percentage decline since November, 2008.
Trading was curtailed on Monday with markets in the US and UK closed on Monday for public holidays.
Chinese Premier Wen Jiabao warned on Monday that global economic growth remained vulnerable to sovereign debt risks and the possibility of a second downturn, while saying China's growth remains on track.
Fitch Ratings downgraded Spain's sovereign credit rating by one notch on Friday, saying the country's economic recovery would be "more muted" than government forecasts due to austerity measures.
"It's not a shocking thing any more. People get a pretty good idea because in general the feeling is that even the $1-trillion rescue package is not going to solve the problem. It's just confirming what they already know," said Clarence Chu, a trader at Hudson Capital in Singapore.
"We expect the market to be very quiet with very low volume, unless there is some breaking news," Chu said." The oil prices usually move in a tight range during long holidays."