On Wednesday crude-oil futures rose in Asian session but gains were trimmed after China’s economic data showed slower growth in the first quarter of the year.
China is the world’s second-largest consumer of oil and its economic slowing is bearish for its oil demand.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in May
CLK5 traded at $53.63 a barrel, up
$0.36, or 0.7%, in the Globex electronic session.
On London’s ICE Futures exchange May Brent crude LCOK5 rose $0.44, or 0.7%, to $60.25 a barrel.
Driven by signals of peaking U.S. oil production, oil prices have gained for the last four consecutive trading sessions. Oil ended higher Tuesday on the back of a weaker dollar and short covering ahead of the expiration of the May contract for Brent crude later today.
Brent crude, however, remained under the $60 mark. China’s National Bureau of Statistics said the country’s gross domestic product grew by 7.0% from a year earlier in the first quarter, slowing from 7.3% in the fourth quarter.
“China’s consumer markets also weakened considerably, with growth falling to 10.2%, the lowest since 2006, raising doubts about the stability of consumption amidst the construction and industrial slowdown,” Brian Jackson, China Economist at IHS Global Insight, said.
In the meantime, the American Petroleum Institute’s inventory data indicated late Tueday that U.S. crude stocks rose by 2.6 million barrels last week. The more closely watched data from the U.S. Energy Information Administration is due later today and analysts expect it to report higher crude supplies of 3.6 million barrels.
“Traders may be eager to buy crude oil
in anticipation of a further price recovery, but we see the high stock
levels as likely to cap the market for an extended period of time,”
analyst Tim Evans at Citi Futures said.
Crude supply from the Organization of the Petroleum Exporting Countries is also surging.
According to data compiled by Platts, a price reporting agency, OPEC’s oil production totaled 30.72 million barrels a day in March, which was 800,000 barrels higher than February and the highest monthly volume since November 2012.
Markets will be tracking the monthly oil market report from the International Energy Agency later today, and from OPEC tomorrow.
Nymex reformulated gasoline blendstock for May RBK5 — the benchmark gasoline contract — rose 203 points to $1.8563 a gallon, while May diesel traded at $1.8137, 120 points higher. ICE gasoil for May changed hands at $552.25 a metric ton, up $6.50 from Tuesday’s settlement.
