Oil prices drop on weak China manufacturing data
World oil prices slid Monday on data
showing that the key manufacturing
sector in China, the world’s top energy
consumer, shrank in October for the
third straight month.
Brent North Sea crude for delivery in
December lost 84 cents to stand at
$48.72 a barrel in London midday deals.
US benchmark West Texas Intermediate
for December shed 76 cents to $45.83 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 (PMI),
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 released over the weekend
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 broker Sucden.
Oil prices had last week won support
following a decline in US crude
production which boosted hopes it could
help ease a global oversupply that has
depressed crude futures for more than a
year.
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