The April contract slumped to $97.55 a barrel on Wednesday, the lowest since February 7, before trimming losses to settle at $97.99 a barrel, down 2.04%, or $2.04. Nymex oil futures were likely to find support at $97.14 a barrel, the low from February 7 and resistance at $99.60 a barrel, the high from March 12. Data released earlier showed that industrial production in China rose by an annualized rate of 8.6% in the first two months of 2014, the weakest since March 2009 and below expectations for a 9.5% increase. A separate report showed that Chinese retail sales rose by a smaller-than-forecast 11.8% in the same period, the slowest pace for the first two months since 2004. Oil has been under heavy selling pressure in recent sessions as growing concerns over the health of China’s economy dampened demand for growth-linked assets. The Asian nation is the worlds second largest oil consumer after the U.S. and has been the engine of strengthening demand. Meanwhile, market players looked ahead to key U.S. economic data later in the day for further indications on the strength of the economy and the future course of monetary policy. The U.S. is to release data on retail sales and import prices, in addition to the weekly government report on initial jobless claims. Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for April delivery declined 0.19%, or $0.20 cents, to trade at $107.82 a barrel, while the spread between the Brent and U.S. crude contracts stood at $9.87 a barrel. On the New York Mercantile Exchange, West Texas Intermediate crude for delivery in April dropped to a session low of $97.86 a barrel, before trimming losses to last trade at $97.95 during European morning hours, down 0.05%, or $0.04 cents U.S. oil futures traded near a five-week low on Thursday, after disappointing Chinese economic data underlined concerns over the health of the world’s second largest economy.
Posted on: Thu, 13 Mar 2014 10:05:48 +0000