Brent Oil prices fell in London early Monday as concerns China's economic recovery is slowing overshadowed growing risks that Russia is massing its troops on Ukraine's border.
While the crisis-hit Ukraine continues to top the headlines, weak economic data from China weighed on the oil markets with the start of the week. The flash Markit/HSBC Purchasing Managers' Index (PMI) fell to an eight-month low of 48.1 in March from February's final reading of 48.5. The flash PMI was still below neutral-50 mark signaling detoriorating manufacturing activity, which reignited concerns over the outlook for oil demand in the world's second largest economy.
As of 03:44 a.m. ET:
- WTI Crude for May delivery fell 0.04% to $99.42 a barrel
- Brent Crude dropped 0.12% to $106.79 a barrel
Three days after Russia completed the seizure of Crimea, markets continue to fear growing risks of a possible war over Ukraine -- the sentiment which has been offering much of support to oil prices since the crisis unfolded in late Febraury.
The White House warned on Sunday that Russia is possibly preparing to invade eastern Ukraine, after Tony Blinken, a deputy national security advisor, sounded the alarm over an apparent builup of Russian troops on the Ukranian border.
On Friday, the Russian President Vladimir Putin signed a low formalising Crimea's annexation, despite the sanction and international outcry over his action on Ukraine.
The geopolitical tensions between Ukraine and Russia still has the potential to have serious impact on the European economy and global financial markets, and especially energy prices, as Russia does supply around 30% of Europe's natural gas, as well as significant amounts of oil and coal.
Russia's annexation of Crimea after the ousting of Ukraine's pro-Russian president by mass protests in Kiev has triggered the worst East-West crisis since the Cold War.