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Oil prices drop on Chinese, Russian data

Oil prices drop on Chinese, Russian dataLONDON: World oil prices fell Monday on data showing that the key manufacturing sector in China, the world’s top energy consumer, shrank in October.

Prices were depressed also by figures showing Russian oil output at record levels, according to analysts.

Brent North Sea crude for delivery in December lost 62 cents to stand at $ 48.94 a barrel in late London deals.

US benchmark West Texas Intermediate for December shed 38 cents to $ 46.21 a barrel compared with Friday’s close.

Activity in China’s vast manufacturing sector shrank in October for the third straight month, officials said Sunday, fuelling fears that growth in the world’s second largest economy is slowing faster than policymakers admit.

The Purchasing Managers’ Index, tracking activity in the factory and workshop sector, was unchanged from the previous month at 49.8, the state statistics office said.

A PMI figure above 50 signals expanding activity while anything below indicates shrinkage.

“China’s manufacturing PMI reading for October… offered little encouragement for investors who had hoped that activity in the world’s second largest economy had finally bottomed out and reached a floor,” said Kash Kamal, senior research analyst at Sucden.

The brokerage added that Russian oil production climbed to 10.78 million barrels per day in October. Although Saudi Arabia produced less, at around 10.1 mbpd, it remains the world’s biggest exporter of crude.

Oil prices had last week won support following a decline in US crude production amid a global oversupply that has depressed crude futures for more than a year.

Copyright AFP (Agence France-Presse), 2015

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