Aug 7 (Reuters) - The Russian rouble recovered from hitting a 16-1/2-month low past 97 to the dollar in a volatile session on Monday, paring early losses to strengthen as strong local demand for foreign currency eased.

The rouble extended losses for most of the day after dropping more than 4% against the dollar and euro to record one of its worst weeks all year. Russian authorities say lower export revenues and rebounding imports are the primary cause of rouble weakening.

By 1502 GMT, the rouble was 0.1% stronger against the dollar at 95.60, earlier hitting 97.0625, its weakest point since March 25, 2022.

It had gained 0.4% to trade at 105.19 versus the euro , earlier falling to a more than 16-month low past 106 on Friday. It had firmed 0.7% to 13.24 against the yuan .

The rouble tends to weaken early each month after losing support of a month-end tax period that usually sees exporting firms convert foreign exchange (FX) revenues to meet local liabilities.

Market players have also attributed the rouble's jitters to Western companies' exits from Russia, which can require large FX purchases and foster currency market volatility.

Demand for foreign currency should subside, said Alor Broker's Alexey Antonov in a note, as importers could lose confidence in their ability sell at higher rouble prices.

"However, buying the rouble against the dollar is still frightening," Antonov said. "Any negative could provoke a little panic on the FX market with the (dollar-rouble) currency pair going above 100."

Brent crude oil, a global benchmark for Russia's main export, was down 1.1% at $85.15 a barrel, but touched a near four-month high earlier in the session.

"The growth in prices for oil has not yet led to increased foreign currency revenues for Russian companies, as settlements are lagging in time, but soon the situation should improve," said SberCIB analysts.

According to Reuters calculations, high oil prices should mean July's mineral extraction tax is the highest since April 2022.

Russian stock indexes were higher, recovering ground after a sharp slide in the previous session.

The dollar-denominated RTS index was up 0.9% to 1,024.9 points. The rouble-based MOEX Russian index was 0.4% higher at 3,105.5 points. (Reporting by Alexander Marrow; Editing by Sharon Singleton and Shailesh Kuber)