* Canadian dollar falls 0.2% against the greenback * Price of U.S. oil declines 1.1% * Canadian bond yields ease across much of a flatter curve TORONTO, Dec 7 (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Monday as rising tensions between the United States and China weighed on investor sentiment, with the currency pulling back from a two-and-a-half-year high on Friday. Global shares fell after Reuters reported Washington was preparing to impose sanctions on some Chinese officials over their alleged role in Beijing"s disqualification of elected opposition legislators in Hong Kong. Canada runs a current account deficit and is a major exporter of commodities, including oil, so the loonie tends to be sensitive to the global flow of trade and capital. Oil prices were pressured by heightened U.S.-China tensions and surging coronavirus cases. U.S. crude prices were down 1.1% at $45.75 a barrel. The Canadian dollar was trading 0.2% lower at 1.2808 to the greenback, or 78.08 U.S. cents. On Friday, it touched its strongest intraday level since May 2018 at 1.2768 after data showed that Canada added more jobs than expected in November. Strategists have raised their forecasts for the loonie, expecting the currency to benefit from domestic economic stimulus and the rollout of a COVID-19 vaccine, a Reuters poll showed. A separate Reuters poll showed that the Bank of Canada will not increase its asset-purchase program anytime soon. The central bank is due to make an interest rate decision on Wednesday. Still, speculators have raised their bearish bets on the Canadian dollar, data from the U.S. Commodity Futures Trading Commission showed on Friday. As of Dec. 1, net short positions had increased to 21,243 contracts from 16,846 in the prior week. Canadian government bond yields were lower across much of a flatter curve on Monday, with the 10-year down 3 basis points at 0.768%. Earlier in the session, it touched its highest since Nov. 13 at 0.810%. (Reporting by Fergal Smith Editing by Chizu Nomiyama)