Oil prices dipped after disappointing Chinese manufacturing data raised concerns about crude demand.
NEW YORK (AFP) – Oil prices dipped Monday after a disappointing manufacturing report on China raised concerns about crude demand, overshadowing worries about growing violence in the Ukraine crisis.
The US benchmark, West Texas Intermediate (WTI) for June delivery, finished at $99.48 a barrel, down 28 cents from Friday’s close.
Brent North Sea crude for June fell 87 cents to settle at $107.72 in London.
Oil futures were under pressure after HSBC’s survey showed China’s manufacturing sector contracted for a fourth consecutive month in April.
The Chinese data was worse than expected and “increased concerns that China’s economic slowdown is expanding,” said Eugene McGillian at Tradition Energy.
Also exerting downward market pressure was the expectation that the Department of Energy will report another increase in US commercial oil inventories on Wednesday, said Bob Yawger of Mizuho Securities.
US stockpiles hit a record 399.4 million barrels in last week’s report.
The rising violence in Ukraine, between nationalists and pro-Russian separatists enjoying Moscow’s backing, has kept the attention of traders worried about possible interruptions to regional fuel supplies. About 30 percent of Europe’s imports of oil and gas come from Russia.
At the same time, said John Kilduff of Again Capital, there are worries about what a sustained crisis will do to Europe’s and Russia’s already struggling economies.
The Ukraine crisis “cuts both ways,” Kilduff said. On one hand, there are “worries about Russian exports” and on the other investors are concerned about the damaging economic impact on Russia and Europe, he said.