NEW YORK (Reuters) - Crude futures ended almost 2 percent lower on Thursday as weak manufacturing data from China and the euro zone raised concerns that a slowdown in global growth could cut demand for oil.
The day’s losses wiped out gains of more than 1 percent on Wednesday that emerged after data showed a surprise drawdown in U.S. crude inventories last week. <EIA/S>
Losses were briefly pared in the morning on a report that first-time filings for jobless claims fell to a four-year low last week.
If prices do not recover on Friday, U.S. crude oil is looking to end the week lower for the second week in a row.
A monthly Reuters poll showed that Brent crude will average $114.30 per barrel this year, from $110.30 in February while U.S. crude will average $105 from $101.70 in the previous poll.
On the New York Mercantile Exchange, crude for May delivery settled at $105.35 a barrel, falling $1.92, or 1.79 percent.
In London, ICE May Brent crude closed at $123.14 a barrel, dropping $1.06, or 0.85 percent, the lowest settlement for front-month Brent since March 6, when prices ended at $121.98.
Brent’s premium against U.S. crude widened to $17.79 at the close, from $16.93 on Wednesday.
In Cushing, Oklahoma, the delivery point for U.S. traded crude oil futures, U.S. President Barack Obama reiterated his pledge to speed up the approval for the southern leg of the Keystone XL pipeline that would ship crude from the glutted Midwest to the refinery hub at the Texas Gulf Coast.
A gauge of future U.S. economic activity compiled by the Conference Board posted its fifth straight monthly increase in February in a sign of gaining economic momentum.
Factory activity in China contracted for a fifth straight month in March as new orders fell, exports sagged and new hiring dropped to a two-year low, according to the HSBC flash purchasing managers index.
The euro zone economy took an unexpected turn for the worse in March, with the rate of contraction accelerating and hit by a sharp fall in French and Germany factory activity that even the most pessimistic economists failed to predict, business surveys showed.
The European Union will allow some insurance on Iranian oil shipments before the bloc’s full embargo starts on July 1, member states agreed on Thursday in response to concerns from Asian importers heavily reliant on the EU for their cover.
Plans to grant more autonomy to Libya’s oil-rich east were laid out this week at the nation’s first oil and gas summit held in Rome after months of unease among international oil companies over the uncertainty.
Wall Street retreated, with cyclical sectors leading the market lower and setting up the Standard & Poor’ s 500 Index for its first negative week in six, in the wake of the weak factory data in the euro zone and China. .N
The euro slid against the dollar and yen as the fall in manufacturing in France and Germany as well as China rekindled worries about global growth. <USD/>
Copper fell to a two-week low, hit by concerns about the health of the global economy. <MET/L>
Gold dropped to its lowest level in more than two months on concerns about global economic growth. <GOL/>
U.S. new home sales for February, 10 a.m. EDT, Friday.
CHNG CHNG VOL VOL CLc1 105.35 -1.92 -1.8% 104.50 107.12 286,549 252,603 CLc2 105.84 -1.91 -1.8% 105.01 107.60 75,106 69,194 LCOc1 123.14 -1.06 -0.9% 122.30 124.25 182,685 152,408 RBc1 3.3396 -0.0175 -0.5% 3.2953 3.3569 33,197 32,363 RBc2 3.3257 -0.0195 -0.6% 3.2855 3.3416 59,421 43,134 HOc1 3.1787 -0.0375 -1.2% 3.1575 3.2209 31,125 35,568 HOc2 3.1928 -0.0382 -1.2% 3.1728 3.2351 51,676 42,858
CURRENT Mar 21 30D AVG Mar 21 NET CHNG
CRUDE 528,816 473,244 672,119 1,561,042 -2,758
RBOB 164,984 135,340 142,746 386,886 -1,687
Reporting by Gene Ramos; Editing by Marguerita Choy