NYMEX crude weaker in early Asia ahead of China PMI
Investing.com – Crude oil prices fell in early Asia on Monday as investors looked ahead to a key manufacturing gauge in China for demand cues.
On the New York Mercantile Exchange oil futures for September dipped 0.27% to $46.68 a barrel.
Ahead are manufacturing PMIs from Japan, seen at 51.4 in July, and China – with the Caixin/Markit China final for July seen at 48.3 in the flash estimate.
China is the world’s second largest energy user.
Last week, futures fell sharply on Friday to cap the worst monthly performance since the 2008 global financial crisis as ongoing concerns over a glut in world markets continued to drive down prices.
On the ICE Futures Exchange in London, for September delivery fell to a session low of $51.63 a barrel, a level not seen since January 30, before closing at $52.21, down $1.10, or 2.06%, for the day.
For the week, London-traded Brent futures lost $2.24, or 4.41%, the fifth straight weekly decline. Prices tumbled $11.39, or 18.6%, in July, amid concerns a resumption of Iranian oil exports will add to a global glut.
Iran and six world powers reached a long-awaited nuclear deal in July that would end sanctions on Tehran in exchange for curbs on the country’s disputed nuclear program. Iran reportedly hoards 30 million barrels of oil in its reserves ready for export.
Reports of record high oil exports from Iraq and robust production from Saudi Arabia also contributed to losses.
Global oil production is outpacing demand following a boom in U.S. shale oil production and after a decision by the Organization of Petroleum Exporting Countries last year not to cut production.
Elsewhere, U.S. oil futures fell to the lowest level in more than four months on Friday, after data showed that rigs drilling for oil in the U.S. rose last week, underlining concerns over robust domestic production.
Industry research group Baker Hughes (NYSE:NYSE:) said late Friday that the number of rigs drilling for oil in the U.S. increased by five last week to 664, the second straight weekly gain.
Concerns over the health of China’s economy, a broadly stronger U.S. dollar and prospects of higher interest rates in the U.S. later this year also weighed.
In the week ahead, investors will be focusing on Friday’s non-farm payrolls report for July, for fresh indications on the strength of the economy and the timing of a U.S. rate increase.
On Monday, The U.K. is to publish its manufacturing index.
The U.S. is to release data on personal income and expenditure, while the Institute of Supply Management is to release data on manufacturing activity.
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