Oil down as China factory data, Russia sanctions risk considered
March 26, 2014, 1:06 am TWN
Oil prices edged slightly lower on Tuesday as soft factory data from China and the U.S. balanced the threat of sanctions against Russia following its annexation of the Crimean Peninsula.
Benchmark oil for May delivery was down 6 cents to US$99.54 at 0610 GMT in electronic trading on the New York Mercantile Exchange. The contract rose 14 cents to close at US$99.60 on Monday.
A dismal preliminary report on factory activity in China continued to weigh on sentiment. The HSBC-Markit purchasing managers' index fell to an eight-month low in March, further evidence of the prolonged slowdown that could lead to lower demand for energy in the world's No. 2 economy. A similar index for the U.S. fell from a four-year high.
Offsetting those concerns was the possibility of sanctions against oil and gas producer Russia. The U.S. and other Group of Seven countries vowed to launch coordinated sanctions on key parts of the economy, which could include the energy industry, if Russian President Vladimir Putin presses further into Ukraine.
Brent crude, used to set prices for international varieties of crude, slipped 15 cents to US$106.66.
In other energy futures trading on Nymex:
— Wholesale gasoline was steady at US$2.886 a gallon.
— Heating oil fell 0.2 cent to US$2.912 a gallon.
— Natural gas rose 0.4 cent to US$4.28 per 1,000 cubic feet.