China worries pull on oil price

Oil traders26 January 2014, News Wires  Global oil prices briefly tumbled below $107 a barrel on Friday before recovering, tracking a selloff in stocks and emerging markets as worries mounted over an economic slowdown in China, Reuters reported.

Expectations that the US Federal Reserve will taper its stimulus package next week also weighed on prices, it said.

Brent crude was down $0.28 at $107.30 by 2:10am GMT, paring declines that saw it drop more than $1.20 earlier in the day, according to the news wire.

Despite the fall, the international oil benchmark was still heading for its biggest weekly gain since 20 December.

US oil, or WTI, also pared earlier declines to trade about $0.05 lower at $97.27. It settled $0.59 higher on Thursday and was still set to record its biggest weekly rise since 6 December, Reuters continued.

China’s factory sector shrank in January for the first time in six months, a preliminary survey showed on Thursday, suggesting a weak start for the economy in 2014.

Investors fled markets in Asia and Latin America, fearing the impact of slower growth in China and on expectations the Fed will cut further its bond-buying stimulus at a policy meeting next week.

Brent and US oil futures had started the day strongly as bitter cold in the US sapped stockpiles of crude and distillates in the world’s largest consumer of oil and drew heating oil imports from Europe, Russia and Asia.

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