01 May 2014, News Wires – Brent oil fell more than $1 to under $107 on Thursday as lacklustre Chinese economic data, the prospect of a rise in Libyan oil supply and record high US inventories weighed on prices.
China’s Purchasing Managers’ Index rose marginally in April but export orders fell, failing to dispel concern as to whether the economy of the world’s second-largest oil consumer is stabilising after a first-quarter slowdown.
“It’s slightly negative as it confirms a reasonably difficult outlook for the Chinese manufacturing sector,” said Ric Spooner, chief analyst at CMC Markets in Sydney.
Brent crude for June fell $1.13 to $106.94 a barrel by 1600 GMT, after hitting an intra-day low of $106.85, its lowest price since 8 April. US crude fell 48 cents to $99.26.
The imminent restart of an oil port in eastern Libya port pressured Brent. Zueitina will load its first tanker between Thursday and Saturday, after being closed for nearly 10 months due to protests, trading and shipping sources said.
Protests and strikes are still keeping Libya’s output at a fraction of its potential. Analysts do not expect a rapid recovery as previous agreements for Libyan ports to reopen and supplies to resume have failed to materialize.
Also pressuring prices lower, US crude inventories rose last week to a record high, a report from the government’s Energy Information Administration showed on Wednesday.
Inventories now stand at just under 400 million barrels, the largest since 1982 when the EIA began its surveys. The increase pressured US crude, widening its discount to Brent to more than $8.