Weak US manufacturing data pressured Brent crude oil to slip under $102 per barrel on Tuesday as investors worried about weakening global demand. The commodity traded at $101.84 at 9:30 GMT on Tuesday morning with most analysts expecting to see prices remaining between $100 and $105 for the remainder of the week.
After the US economy grew at a rate of 2.4 percent in the first quarter of 2013, many were optimistic about an increase in global demand as the number one oil consuming nation's economy recovered. However, new data from the US showed that the nation's factory activity fell in May to its lowest level in almost four years.
CNBC reported that US manufacturing sector fell short of expectations in May with its index of national factory activity falling to 49.0 in May. A reading below 50 indicates contraction, something the US hasn't seen in its manufacturing sector since November of 2012, when the East Coast was effectively shut down due to a massive storm.
The latest data also eased investors' concern that the US Federal Reserve was going to cut back on its $85 billion stimulus plan. A recent string of positive data that pointed to a strong recovery had many worried that the nation's central bank would start to phase out its quantitative easing program; however the latest manufacturing data has alleviated much of that concern.
Brent found some support from news that the North Sea Buzzard oilfield was shut down, causing an interruption to supply. The oilfield is expected to return to normal production over the next few days.
BY Laura Brodbeck
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Weak US Manufacturing Pressures Brent
Published 06/04/2013, 08:10 AM
Updated 05/14/2017, 06:45 AM
Weak US Manufacturing Pressures Brent
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