Oil flat despite US, China factory strength
The price of oil held steady Tuesday despite signs that manufacturing activity grew in the U.S. and China, the world’s two biggest oil consumers.
Benchmark U.S. crude for August delivery fell 3 cents to close at $105.34 a barrel in New York. It is the fourth day in a row of declines and the sixth decline in the last seven trading days. The contract closed at a 10-month high of $107.26 on June 20.
Brent crude, a benchmark for international oils used by many U.S. refineries, fell 7 cents to close at $112.29 a barrel in London.
Manufacturing activity in China, the world’s biggest oil importer, grew in June for the first time in six months, according to a private survey. Manufacturing activity in the U.S., the world’s biggest oil consumer, grew in June for the 13th-straight month, though the pace of the expansion slowed from May.
It wasn’t enough to push the price of oil higher, which suggests oil supplies may be ample enough to meet even rising global demand and prices could be headed lower.
“The fact that some positive manufacturing numbers and associated strong gains in the U.S. stock market were ignored reinforces our opinion that some additional price weakening through the next few sessions lies ahead,” wrote independent energy analyst Jim Ritterbusch in a note to investors Tuesday.
Oil prices have risen in recent weeks on concerns that violence in Iraq, OPEC’s second-largest exporter, would cut global supplies. They stabilized late last week as the stunning initial advance by insurgents lost momentum.
In other energy futures trading on the Nymex:
—Wholesale gasoline fell 0.6 cent to close at $3.037 a gallon.
—Natural gas fell 0.6 cent to close at $4.445 per 1,000 cubic feet.
—Heating oil rose 0.3 cent to close at $2.978 a gallon.