Oil prices increased today following positive industrial output and a rise in retail sales for November in China, the latest in a series of signs indicating fuel demand in the world’s second-largest oil consumer.
Brent crude increased by 20 cents to $109.55 a barrel, while US crude grew by 35 cents to $97.69 a barrel, reported Reuters.
China’s factory output increased by ten percent from a year ago, while retail sales were up 13.7%, indicating that government reforms are expected to support demand for commodities such as crude, energy and metals.
The country’s economy grew 7.8% in three months to September from a year earlier, up from the 7.5% growth recorded for the previous three months, with signs of recovery after it faltered in the first half of the year.
But in the early session Brent crude fell by two percent in reaction to well-supplied markets and limited demand from European refiners.
Germany’s trade surplus narrowed in October, while industrial output unexpectedly fell, signalling a mixed start to the fourth quarter for Europe’s biggest economy.
Brent prices also declined after TransCanada noted that it has started filling its 700,000 barrel-per-day oil pipeline, which will transport crude from the Cushing, Oklahoma, storage hub to Gulf Coast refiners.
Brent was also weighed down by persistently low output from Libya, which is currently producing 250,000 barrels per day (bpd), down from 1.4 million bpd in 2012.
According to Time Magazine, Iranian Foreign Minister Javad Zarif said new sanctions from US Congress on Iran will kill its nuclear deal with major powers.
He also said the November deal had increased the prospect of more oil supply and deflated a risk premium in oil prices.
Image: Brent’s value increased as Chinese data showed strong oil demand. Photo courtesy of freedigitalphotos.net.