Crude prices rebound amid gloomy China data
On Tuesday, crude oil prices climbed up, reacting to China’s negative manufacturing data, unveiling a seventh contraction in February.
Market participants are still concerned with the fact oil demand from the world’s second largest economy is going to slow down.
In New York, light, sweet crude oil futures for April delivery hit $34.09, a 1% rise. Secondly, Brent crude futures surged to $36.93 a barrel, also a 1% rally.
According to the National Bureau of Statistics, a true indicator of the country’s factory activity, China’s official manufacturing purchasing managers’ index went down to 49 in February, a decrease from 49.4 in previous month. Meanwhile, a PMI reading above 50 indicates an obvious expansion in manufacturing activity, and a reading below 50 points out to a contraction.
By the way, some financial analysts drew attention to the fact that seasonal factors were most probably in play, because in February most factors were unavailable during the Lunar New Year.
China’s slowing manufacturing activities will undoubtedly weigh on sentiment.
The country’s high consumption of oil has definitely stood out in the pessimistic oil market. However, China shifts step by step from a heavy industry-based economy to a service-oriented one, and this might tame China’s oil-demand growth.