Oil extends losses in Asian trade
Singapore: Oil extended its losses in Asian trade on Thursday on mounting concerns about an economic slowdown in China, with the strong US dollar also putting pressure on prices, analysts said.
New York's main contract, West Texas Intermediate (WTI) for delivery in September, was down 57 cents at USD 104.82 a barrel in mid-morning trade, while Brent North Sea crude for September shed 36 cents to USD 106.83.
WTI dived USD 1.84 in New York yesterday after HSBC's preliminary purchasing managers (PMI) index of Chinese manufacturing activity hit an 11-month low, signalling weaker demand in the world's top energy consumer. Brent sank USD 1.23 in London.
"We are seeing a continuation of last night's pullback in crude prices over the weak Chinese data," Michael McCarthy, chief market strategist at CMC Markets in Sydney, said.
The sluggish reading in China overshadowed upbeat economic data in the eurozone, where private business activity returned to growth in July for the first time in 18 months.
Adding to the selling pressure was a pickup in the dollar, which makes oil more expensive for buyers using weaker currencies, denting demand.