Oil prices in New York and London retreated today after rallying on Monday on the back of strong manufacturing data released in China and the US.
The reported that were out on Monday showed that industrial activity in China increased for the fourth month in a row, while the Institute for Supply Management’s (ISM) US factory index rose to 53.4 last month from
The reports, which offset a disappointing update on the Markit/CIPS euro zone manufacturing index, which dropped to 47.7 from 49, triggered a rally in equity markets around the globe and lifted demand for commodities.
Equities and commodities fell today as investors reaped profits.
Today's US data put more pressure on crude. The Commerce Department said factory orders in the US rose 1.3 percent in February, narrowly missing forecasts, which were for an increase of 1.5 percent.
In addition, the January figure was revised from a one percent decline to a 1.1 percent drop.
While the West Texas Intermediate benchmark shed nearly 50 cents per barrel in the US this morning, Brent fell marginally thanks to support from the shutdown of BP’s (LON:BP.) Valhall platform in the North Sea for maintenance.
The shutdown has resulted in loading delays of one of the crude streams used for the Brent benchmark.
Commodity traders are now looking to today’s inventories report from the American Petroleum Institute (API), which will be followed by the more closely followed report from the Department of Energy.
US light, sweet crude for May delivery currently the most actively traded contract on the New York Mercantile Exchange (NYMEX), declined 48 cents to US$104.75 pence.
May Brent crude fell one cent to US$125.33/barrel on the ICE Exchange this afternoon.
Today’s top risers in the oil and gas sector were:
Heritage Oil (LON:HOIL), up 12 percent at 154.51 pence at midday
Sefton Resources (LON:SER), up 8 percent at 2.51 pence
Valiant Petroleum (LON:VPP), up 5 percent at 562 pence
Cairn Energy (LON:CNE), up 4.5 percent at 334.8 pence
Salamander Energy (LON:SMDR), up 4.5 percent at 234.5 pence
The top fallers were:
Mediterranean Oil & Gas (LON:MOG), down 6.5 percent at 5.25 pence at midday
Oilex (LON:OEX), down 6 percent at 17.12 pence
Gulfsands Petroleum (LON:GPX), down 6 percent at 145 pence
Wessex Exploration (LON:WSX), down 4.5 percent at 9.3 pence