The Asian trade oil prices has slipped following healthy gains in London and New York, but losses were limited as investors were cheered by signs of recovery in China’s manufacturing sector, Business Inquirer reports.
The Western Texas Intermediate (WTI) – for delivery in July – eased seven cents to $104 in afternoon trade, after jumping $1.74 which was close to a one-month high yesterday.
Brent North Sea crude oil for July was down three cents at $110.51. The contract gained 86 cents in London, touching a level last seen in early March.
Banking giant HSBC said preliminary data from its Purchasing Managers Index (PMI) showed activity in China’s factories shrinking at a much slower pace in May than the previous month, improving from 49.7 to 48.1.
Whilst this figure is below the 50-mark, which normally signals a contraction, it is the second straight month of improvement and is a telling sign that the world’s number two economy is picking up.
“Chinese PMI came in a lot better than expected, especially since the past few Chinese data [releases] have been really week,” says Desmond Chua, market analyst at CMC Markets in Singapore.
