Brent crude futures rose to above $85.5 a barrel on Monday for the first time since October 2018, and after gaining over 3% in the previous week as demand is unable to keep up with a booming demand following the reopening of the economies. Market tightness has been intensified by shortages of natural gas and coal in Europe and Asia, which can boost demand by as much as 450,000 barrels a day in Q4. In addition, the US is set to open its borders to vaccinated foreigners on November 8th. Meanwhile, recent data showed that China's economy, the world’s top oil importer and second-biggest consumer of the fossil fuel, grew the least in a year in Q3 and less than market expectations. Looking to future output, data from Baker Hughes last week showed the number of active US rigs drilling for oil rose by 12 to 445 in the week ending October 15th, the sixth consecutive week of increases. The total active US rig count, which includes those drilling for natural gas, also climbed by 10 to 543.

European stock markets traded in the red on Monday after posting the best week since March, amid global inflation worries due to a rally in energy prices and supply chain bottlenecks, and as weaker-than-expected GDP data from China raised concerns over slowing growth. The world's second-largest economy grew 4.9% in July-September from a year earlier, worse than market expectations of 5.2% and the weakest pace of expansion in a year, due to power shortages, supply bottlenecks and COVID-19 outbreaks. On the corporate front, shares of Philips fell more than 2% after the health technology company lowered its outlook for sales and profit growth in 2021 as a global shortage of electronic components hit its third-quarter earnings. The DAX 30 lost 0.3% around 9:30 AM Frankfurt time, while other major European indexes fell between 0.1% and 0.7%.

Natural gas futures fell almost 5% to a 3-week low of $5.1 per million British thermal units on Monday, as demand is seen falling amid mild weather in the US for the rest of October. Meanwhile, major Chinese energy companies are in talks with US exporters to secure long-term liquefied natural gas supplies, as soaring gas prices and domestic power shortages heighten concerns about the country's fuel security, Reuters reported mentioning several sources. Still, gas prices remain elevated and not far from a seven-year high of $6.5 early hit earlier in the month, amid strong demand during the winter heating season and depleted inventory levels, especially in Europe and Asia. The EIA forecasts that natural gas prices at the US benchmark Henry Hub will average $5.67 per million British thermal units between October and March, the highest winter price since 2007–2008.

WTI crude oil extended gains by 1.3% to above $83.5 per barrel early in Asia on Monday, hitting fresh multi-year highs as demand continues to increase and amid a global energy crunch. The U.S., Australia and some Asian countries are beginning to ease restrictions for vaccinated travelers, removing quarantine requirements to spur tourism and other business activities. Oil price is also being kept higher by power generators switching from expensive gas and coal to oil and diesel as major industrial countries face power shortages. Meanwhile, U.S. oil and rig count rose 10 to 543 in the week ending Oct. 15, its highest since April 2020 according to Baker Hughes Co. Elsewhere, China’s September daily crude processing rate fell to the lowest since May 2020 as feedstock shortage and environmental inspection crippled operations at refineries and a power crunch dampened refined oil demand from downstream users.

China's retail trade rose by 4.4 percent year-on-year in September 2021, after a 2.5 percent gain in the previous month and beating market expectations of 3.3 percent, as consumption strengthened after COVID-19 outbreaks in some regions were under control. There were rises in sales of jewelry (20.1 percent vs 7.4 percent in August), cosmetics (3.9 percent vs flat reading), personal care (0.5 percent vs -0.2 percent), telecoms (22.8 percent vs -14.9 percent), home appliances (6.6 percent vs -5.0 percent), furniture (3.4 percent vs 6.7 percent), and building materials (13.3 percent vs 13.5 percent). In contrast, sales fell for both garments (-4.8 percent vs -6 percent), and automobiles (-11.8 percent vs -7.4 percent). In the January to September period, retail sales jumped 16.4 percent compared to the same period of 2020.

Japanese stocks drifted lower early on Monday after a strong finish last week as the October 31 Japanese general election loomed large on the markets, with the Nikkei 225 index down about 0.2% to trade below 29,000 while the broader Topix index was lower by 0.3% to around 2,017. A Kyodo news survey showed on Sunday that the ruling Liberal Democratic Party is the most popular among Japanese voters though 40% remained undecided on party choice ahead of the general election. The heads of the major parties are scheduled to hold a public debate on Monday which will likely focus on pandemic response should another wave of infections arise and on the economic recovery and income inequality. Tech companies retreated while economic reopening stocks in the auto and retailing industries rose in early deals on Monday.