MW: Oil rebounds on positive China manufacturing data
Crude-oil futures bounced back early Tuesday after overnight losses, helped by an upturn in Chinese manufacturing data.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in November CLX4, +0.15% traded at $91.30 a barrel, up $0.43 in the Globex electronic session. November Brent crude on London’s ICE Futures exchange LCOX4, +0.13% rose $0.30 to $97.27 a barrel.
The preliminary HSBC China manufacturing PMI rose to 50.5 in September, compared with a final reading of 50.2 in August, boosting market sentiment about economic activity and fuel demand in the world’s second-largest economy.
“This was stronger than anticipated,” Julian Evans-Pritchard, China economist at Capital Economics said. He, however, said that even though the economy picked up slightly this month, growth is likely to have slowed for the whole quarter.
China’s oil demand also showed an improvement in August, reversing the declining trend seen in the first half of this year.
The country’s apparent oil demand--a measure of domestic demand after accounting for changes in inventory--rose by 1% in August from July, with year-on-year growth returning to positive territory, analyst Ivan Szpakowski at Citi Research said.
Later Tuesday, oil markets will focus on weekly U.S. inventory data from the American Petroleum Institute, while the U.S. Energy Information Administration will publish its oil inventory report on Wednesday.
Analysts expect U.S. oil stockpiles to continue rising on the back of healthy domestic production, which will weigh on Nymex crude prices.
Nymex reformulated gasoline blendstock for October RBV4, +0.22% --the benchmark gasoline contract--rose 93 points to $2.5940 a gallon, while October diesel traded at $2.6926, 55 points higher.
ICE gasoil for October changed hands at $817.25 a metric ton, up $2.25 from Monday’s settlement.
