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Crude slips on Chinese factory data, Libya export expectations

Published 05/01/2014, 01:59 PM
Updated 05/01/2014, 02:02 PM
Lackluster Chinese factory data softens oil prices

Investing.com - Crude futures fell on Thursday after a Chinese factory barometer missed market forecasts, though positive spending and factory data out of the U.S. cushioned losses.

On the New York Mercantile Exchange, West Texas Intermediate crude oil for delivery in June traded at $99.33 a barrel during U.S. trading, down 0.41%. New York-traded oil futures hit a session low of $98.76 a barrel and a high of $99.89 a barrel.

The June contract settled down 1.52% at $99.74 a barrel on Wednesday.

Nymex oil futures were likely to find support at $98.10 a barrel, the low from March 20, and resistance at $100.59 a barrel, Wednesday's high.

Data released earlier showed that China’s official manufacturing purchasing managers’ index inched up to 50.4 in April, missing expectations for a 50.5 reading, though higher than the 50.3 reported last month.

The Asian nation is the world's second largest oil consumer after the U.S. and has been the engine of strengthening demand, and while the data missed consensus forecasts, it was still above 50, which indicates expansion, which kept oil prices from posting steeper declines.

Also dampening prices were anticipation for increase exports from Libya.

Libyan government officials and rebels reached an agreement to re-open oil ports in recent weeks, and expectations for crude to begin flowing sent investors bracing for increased global supply.

In the U.S., disappointing jobless claims numbers pressured prices lower though better-than-expected consumer spending and manufacturing figures cushioned losses.

The Department of Labor reported earlier that the number of individuals filing for initial jobless benefits last week rose by 14,000 to 344,000 from the previous week’s upwardly revised total of 330,000.

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Analysts had expected jobless claims to fall by 11,000 to 319,000.

Separately, the Commerce Department reported earlier that U.S. personal spending rose 0.9% in March from an upwardly revised 0.5% the previous month, beating expectations of 0.6%.

Consumer spending is the single biggest component of U.S. economic growth, accounting for as much as two-thirds of economic activity.

The report added that personal income rose 0.5%, beating expectations for a 0.4% increase.

Separately, the Institute for Supply Management said its manufacturing PMI rose to 54.9 last month from 53.7 in March, outpacing expectations for a 54.3 reading.

Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for June delivery were down 0.62%, trading at US$107.41 a barrel, while the spread between the Brent and U.S. crude contracts stood at US$8.08 a barrel.

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