Webpack style-loader and css-loader not working on a simple project

I am having an issue on a simple project, after configuring webpack.config.js

const HTMLPlugin = require('html-webpack-plugin')
const { CleanWebpackPlugin } = require('clean-webpack-plugin')
const MiniCssExtractPlugin = require("mini-css-extract-plugin")
const HtmlWebpackPlugin = require('html-webpack-plugin')

module.exports = {
    entry: './src/app.js',
    output: {
        filename: 'bundle.[chunkhash].js',
        path: path.resolve(__dirname, 'public')
    },
    devServer: {
        port: 4200
    },
    plugins: [
        new HTMLPlugin({
            template: './src/index.html'
        }),
        new CleanWebpackPlugin(),
        new MiniCssExtractPlugin()
    ],
    module: {
        rules: [
          {
            test: /\.css$/i,
            use: ['style-loader', 'css-loader'],
          },
        ],
      }
}

and package.json

{
  "name": "08_-pure_js_app",
  "version": "1.0.0",
  "description": "Pure_JS_APP",
  "main": "app.js",
  "type": "commonjs",
  "scripts": {
    "start": "webpack-dev-server --mode development --open",
    "build": "webpack --mode production"
  },
  "keywords": [
    "js",
    "javascript"
  ],
  "author": Andrew,
  "license": "ISC",
  "devDependencies": {
    "clean-webpack-plugin": "^4.0.0",
    "css": "^3.0.0",
    "css-loader": "^6.7.1",
    "html-webpack-plugin": "^5.5.0",
    "loader": "^2.1.1",
    "mini-css-extract-plugin": "^2.6.1",
    "style-loader": "^3.3.1",
    "webpack": "^5.74.0",
    "webpack-cli": "^4.10.0",
    "webpack-dev-server": "^4.10.1"
  }
}

and installing these loaders it still can not interpret styles.css in app.js

import './styles.css'

throwing error "Module parse failed: 'import' and 'export' may appear only with 'sourceType: module' (1:0) You may need an appropriate loader to handle this file type, currently no loaders are configured to process this file."

Tried to find some info here, but the only similar issue I found was when css and style-loaders did not work because './styles.css' were not imported in the js. file, which is not the case here...

Would be very grateful if you have any ideas.

Thanks!