By Noah Browning and Shadia Nasralla

       LONDON (Reuters) -Crude oil prices fell on Monday on expectations of increasing supply, while higher energy costs and rising COVID-19 cases are also seen weighing on demand.

       Brent crude futures fell $1.01, or 1.2%, to $81.16 a barrel, as of 1353 GMT. U.S. West Texas Intermediate (WTI) crude lost 96 cents, or 1.1%, to $79.83 a barrel.

       The fall came after U.N. climate talks ended Saturday with a deal that for the first time targeted fossil fuels as the key driver of global warming.

       Oil markets have dropped for the last three weeks, hit by a strengthening dollar and speculation that President Joe Biden's administration might release oil from the U.S. Strategic Petroleum Reserve to cool prices.

       "Possible releases of oil from U.S. strategic petroleum reserves (SPR) gets lots of the blame from the decline in price," SEB chief commodities analyst Bjarne Schieldrop said.

       "The more likely reason for the current oil price weakness is rising COVID-19 infection rates and associated concerns for global oil demand on the back of lockdowns or restrictions."

       U.S. energy firms last week added oil and natural gas rigs for a third week in a row with crude prices hovering near a seven-year high, prompting some drillers to return to the wellpad.

       The oil and gas rig count, an early indicator of future output, rose by six to 556 in the week to Nov. 12, its highest level since April 2020, energy services firm Baker Hughes Co said on Friday.

       Meanwhile, the Organization of the Petroleum Exporting Countries (OPEC) last week cut its world oil demand forecast for the fourth quarter by 330,000 barrels per day (bpd) from last month's forecast, as high energy prices hampered an economic recovery from the COVID-19 pandemic.

       Europe has again become the epicentre of the COVID-19 pandemic, prompting some governments to consider re-imposing unpopular lockdowns, while China is battling the spread of its biggest outbreak caused by the Delta variant.

       Russia's Rosneft, the world's second-biggest oil company by output after Saudi Aramco, warned on Friday of a potential "super cycle" in global energy markets, raising the prospect of even higher prices as demand outstrips supply.

       (Additional reporting by Naveen Thukral and Roslan Khasawneh; Editing by Maju Samuel and Steve Orlofsky)

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