Investing.com - Crude prices inched higher in Asia on Monday after China manufacturing and services PMI figures supported demand prospects.
The U.S. West Texas Intermediate crude September contract rose 0.36% to $49.89 a barrel, while on the ICE Futures Exchange in London, Brent oil for September delivery gained 0.36% to $52.41 a barrel.
The CFLP manufacturing PMI reached 51.4, a tad below expected, but still in expansion, while a 54.5 for the services PMI also was seen as steady. The private Caixin manufacturing reading is due on Tuesday with a reading of 50.4 seen. Any level above 50 denotes expansion.
The services sector accounted for over half of China's economy last year as rising wages give Chinese consumers the opportunity to shop, travel and eat out more. China's leaders are counting on growth in services and consumption to rebalance their economic growth
Earlier, Japan reported industrial production datafor June rose 1.6%, compared to an expected provisional 1.7% gain.
Later, Australia reported private sector credit gained 0.6%, compared with a gain of 0.4% seen in June.
Last week, oil prices settled higher for the fifth session in a row on Friday to log its biggest weekly gain this year as investors cheered signs that rising demand will offset excess supplies in the second half of the year.
Fresh pledges from Saudi Arabia and Nigeria to respectively pull back on exports and output boosted sentiment. Data showing a fourth consecutive week of declines in U.S. crude inventories and signs of a possible slowdown in U.S. shale production further added to optimism that the oil market was beginning to rebalance.
Weekly figures from energy services company Baker Hughes showed that the number of active rigs drilling for oil edged higher by two to 766 last week, suggesting early signs of moderating domestic production growth.
In May, OPEC and some non-OPEC producers extended an agreement to slash 1.8 million barrels per day in supply until March 2018. So far, the agreement has had little impact on global inventory levels due to rising supply from producers not participating in the accord, such as Libya and Nigeria, as well as a relentless increase in U.S. shale output.
U.S. stockpiles of crude and refined products on Tuesday and Wednesday to gauge the strength of demand in the world’s largest oil consumer.
Meanwhile, traders will also continue to pay close attention to comments from global oil producers for evidence that they are complying with their agreement to reduce output this year.