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Crude oil futures edge lower after flurry of weak EZ PMI’s

Published 09/01/2011, 04:34 AM
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Investing.com – Crude oil futures edged lower on Thursday, after data showed that manufacturing activity in the euro zone fell to a two-year low in August but prices remained supported after upbeat manufacturing data from the U.S. and China.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in October traded at USD88.51 a barrel during European morning trade, shedding 0.35%.  

It earlier fell as much as 0.5% to trade at a daily low of USD88.38 a barrel.

Market research group Markit said earlier that its final reading of the euro zone’s manufacturing purchasing managers’ index fell to 49.0 in August, down from a preliminary reading of 49.7.

National PMI’s held just above the 50.0 no-change mark in Germany, the Netherlands and Austria, but signaled contractions in Ireland, France, Italy, Spain and Greece.

Prices remained supported after official data released earlier showed that China's purchasing managers' index rebounded from a 28-month low in August, climbing to 50.9 from 50.7. A reading above 50.0 indicates growing activity.

The report came after U.S. government data on Wednesday showed that orders for manufactured goods increased 2.4% in July, above expectations for a 1.9% gain.

The U.S. and China are the world’s two largest oil consuming nations and manufacturing numbers are used as indicators for fuel demand growth.

Weekly data from the U.S. Energy Information Administration released Wednesday showed that U.S. crude oil inventories jumped by 5.1 million barrels last week, significantly higher than expectations for a 0.9 million barrel increase.

Total motor gasoline inventories decreased by 2.8 million barrels, above expectations for a 0.9 million barrel decline.

Energy traders have been closely eyeing gasoline stockpiles in recent weeks to gauge the strength of U.S. demand, as the U.S. driving season is currently in the period of peak gasoline demand.

Elsewhere, on the ICE Futures Exchange, Brent oil futures for October delivery slipped 0.44% to trade at USD114.15 a barrel, up USD25.64 on its U.S. counterpart.

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