Brent slips below $108 on EU woes, dollar

Oil

Implied oil demand in China increased to the second highest in history, as refineries ramped up output to a record to ease domestic diesel shortages. Implied demand, a combination of crude runs and net oil product imports, rose 1.7 per cent from a year earlier to about 9.5 million barrels per day (bpd) last month.

"It is a very, very positive factor for the market, given that China is the second biggest consumer of oil", said Le Brun.

A slide in the country's annual inflation rate in November amid a slowdown in industrial output raised expectations the country would loosen monetary policy to stimulate growth, helping boost demand for oil.

Commodities were also buoyed by expectations of further easing in China after most real activity indicators for November eased and CPI and PPI inflation revealed a marked slowdown, analysts at ANZ said in a note.

Top oil exporter Saudi Arabia surprised markets last week by saying it had boosted output to more than 10 million bpd to feed increased demand from consuming countries.

The International Energy Agency (IEA) said a boost in Saudi production would provide welcome relief to rising oil prices, warning continuing hikes threatened to thwart global economic recovery efforts.

For the week ahead, investors are expected to watch for a series of US data numbers such as retail sales, consumer prices, manufacturing and jobless claims -- aside from headlines out of Europe -- to gauge direction.

This week's set of data out of the United States will be important, particularly because recent economic data from the country has been better than expected, Le Brun said. It will give an idea on how the world's oil biggest consumer is doing.

"Participants are also gearing up for a meeting of the OPEC. The global oil market is balanced", Iranian Oil Minister Rostam Qasemi said on Sunday, calling on some OPEC members to cut back as Libyan output resumes.

Please read our terms of use before posting comments
TERMS OF USE: The views, opinions and comments posted are your, and are not endorsed by this website. You shall be solely responsible for the comment posted here. The website reserves the right to delete, reject, or otherwise remove any views, opinions and comments posted or part thereof. You shall ensure that the comment is not inflammatory, abusive, derogatory, defamatory &/or obscene, or contain pornographic matter and/or does not constitute hate mail, or violate privacy of any person (s) or breach confidentiality or otherwise is illegal, immoral or contrary to public policy. Nor should it contain anything infringing copyright &/or intellectual property rights of any person(s).
comments powered by Disqus