Wednesday, April 04, 2012

Oil retreats on profit-taking, weak eurozone data

SINGAPORE: Oil retreated in Asian trade on Tuesday as investors took profits from gains in New York, while weak eurozone manufacturing data also pressured prices, analysts said.

New York's main contract, West Texas Intermediate crude for delivery in May, shed 38 cents to $104.85 per barrel while Brent North Sea crude for May settlement was down 45 cents at $124.98 in the afternoon.



Prices had surged in late trade on Monday, supported by stronger-than-expected industrial data in the United States, the world's biggest oil user.

"There has been some profit-taking... from the price surge brought on by US manufacturing data," said Victor Shum, senior principal at Purvin and Gertz international energy consultants in Singapore.

"The manufacturing data that came out from Europe were quite weak, and that has offset the US data and is weighing on prices," he told AFP.

The purchasing managers index (PMI) compiled by Markit research firm showed eurozone manufacturing activity slumped to a three-month low in March, with major economies Germany and France hit by the slowdown.

The index, a survey of 3,000 eurozone manufacturers, fell to 47.7 points in March, down from 49 points in February. A score below 50 indicates contraction.

A decline in new orders and a rise in oil prices, which hit production costs, contributed to the fall in eurozone manufacturing activity, Markit said.

There were "further signs that the manufacturing malaise already exhibited at the periphery of the currency bloc was spreading to the core," it added.

- AFP/cc

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Source From Channel News Asia

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