Brent oil hovers around $111

22 November 2012, Sweetcrude, LONDON – UK Brent crude hovered near $111, Thursday, as outlook brightened for world oil demand following signs of China’s economy recovery.

But gains were capped as a ceasefire in the Gaza Strip eased concerns over supply.

China’s vast manufacturing sector saw expansion accelerate in November for the first time in 13 months, while a lower than expected drop in US oil inventory also boosted crude prices, Reuters stated.

However, supply risks diminished after Israel and the Islamist Hamas movement agreed on Wednesday to an Egyptian-sponsored ceasefire to halt the eight-day conflict around Gaza.

Brent crude futures had risen six cents to $110.92 per barrel by early Thursday morning, after gaining 0.9% in the previous session. US crude climbed 24 cents to $87.62.

“I’m surprised Brent is so high … there are a lot of predictions that all the weakness in China will eventually get sorted as the new leadership takes over, but it seems like they’re not in a huge hurry to over-stimulate,” Mitsubishi risk manager Tony Nunan told Reuters.

“The whole euro zone situation still remains unresolved, so I think what people are looking for now is for the US to lead the world economy out of its slump. So the big concern is the fiscal cliff. So I think after the holiday, the discussion will be on the US budget.”

US policymakers are looking to avoid a looming fiscal crisis, which has raised fears about the direction of the world’s largest economy.

US stock markets are closed for the Thanksgiving holiday on Thursday.

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  • The Nigerian leadership must take advantage of prevailing high oil prices to grow infrastructure. Unfortunately, revenue receipts from crude oil sales ends up in the pockets of a few thieving government officials.

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  • Federal Govt must not only be blamed 4d fraud in our Oil sector, d judiciary ve a gr8 job 2do 2make sure Oil thieves don’t go free