Brent crude traded above $110 a barrel today with support from China Manufacturing Purchasing Managers’ Index (PMI), which recovered in May compared with April’s final reading.
Brent crude was down by ten cents to reach $110.45 a barrel, while US oil eased 20 cents to settle at $103.87 a barrel, reported Reuters.
Crude prices went up in the previous session as a preliminary HSBC survey showed China’s factory sector’s best performance in five months. May’s HSBC Flash China manufacturing PMI recovered to 49.7, compared with April’s final reading of 48.1.
Oil prices also received support from the Energy Information Administration (EIA) data, which revealed that US crude inventories fell 7.2 million barrels last week while crude stocks at the delivery hub in Cushing, Oklahoma, also fell by 225,000 barrels.
Continued unrest in Libya also supported oil prices as explosions and heavy fighting with anti-aircraft guns could be heard near two military camps in the country’s capital Tripoli.
The country’s major western oilfields remained shut ten days after the government said protesters blocking pipeline flows had agreed to leave.
Libyan National Oil Corp said that the country’s oil output was around 230,000bpd, slightly higher than earlier this week at 210,000bpd but well below the country’s 1.6 million barrels per day capacity.
Wafa field, which has capacity of 30,000bpd, was producing normally in the west.
Commodities assets that are said to be risky were supported by the minutes of the US Federal Reserve’s last meeting, which reassured investors that policy makers will continue to support the economy.
Oil traders are now awaiting manufacturing data from France, Germany and the Euro zone, as well as the US weekly jobless claims, scheduled for release later today.
Image: China’s factory sector shows best performance in five months. Photo: courtesy of Anusorn P nachol.