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SINGAPORE. — Brent crude rose marginally towards $59 a barrel yesterday, helped by better than expected Chinese factory activity data, the Federal Reserve’s flexible stance on US interest rates and the eurozone’s approval of reforms proposed by Greece.
US crude was weaker, however, after settling lower for the fifth consecutive session on Tuesday on the back of a bigger than expected crude stock build-up.
Brent added 22 cents to $58,88 a barrel by 03.17 GMT, while US crude futures fell 2c to $49,26 a barrel.
China’s factory sector showed marginal expansion, according to the flash HSBC/Markit Purchasing Managers’ Index, which edged up to a four-month high of 50,1 in February, just above the 50 level that separates growth in activity from contraction. A Reuters poll of economists had forecast a reading of 49,5.
“That’s good news (as it means) potential oil demand, but I think the market needs to see more stable and concrete demand from China,” said Yusuke Seta, a commodity sales manager at Newedge Japan.
The same Chinese survey showed new export orders shrank at their fastest rate in 20 months. China is the world’s second-largest oil consumer after the United States.
Oil prices also drew support from Federal Reserve Chair Janet Yellen’s suggestion that the US central bank was preparing to consider raising interest rates “on a meeting-by-meeting basis”. Some investors took that to mean rates may start rising later than June, the month markets had been focusing on.
Greece’s four-month extension of its financial rescue on Tuesday also helped lift prices, as eurozone partners approved its reform plan, easing worries the country might leave the eurozone.
Still, concern about excess oil supplies continued to weigh on the market, limiting the impact of positive macroeconomic news, Mr Seta said.
US crude inventories rose by 8,9 million barrels last week as refineries cut output, versus an expected 4 million barrels, data from industry group the American Petroleum Institute showed on Tuesday.
Elsewhere, Opec has no plans for an emergency meeting before June, its next scheduled gathering, two delegates said on Tuesday, responding to reports that Nigeria’s oil minister, the current president of the cartel, would call for one.
Libya has resumed pumping crude from Sarir and Messla oilfields at the rate of around 40 000 barrels a day (bpd) to port Hariga after power was restored. — Reuters.
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