Brent Poised for Monthly Gain, Quarterly Loss
After a choppy week of trading, Brent crude oil seemed poised to end the month on a high for the first time in five months.
Comments from the US Federal Reserve that downplayed the bank's plans to taper its stimulus program helped boost Brent prices and the commodity traded at $103.35 at 8:18 GMT on Friday morning.
Following Fed Chairman Ben Bernanke's announcement that the US central bank would begin paring its $85 billion per month stimulus plan later this year, commodities dropped as the dollar strengthened. Comments from some Federal Reserve governors have temporarily alleviated fears that the bank's plans to roll back its quantitative easing program could weaken the US' oil demand growth.
Brent has been under pressure as a slowing Chinese economy and tight liquidity have raised concern over the number two oil consuming nation's future demand. Moving forward, investors will be watching for Chinese PMI data which will be released on Monday.
According to Reuters, growth in the nation's factory sector isn't expected to impress in June; which doesn't paint a positive picture for the second half of the year. Twelve economists polled by Reuters saw China's PMI reaching 50 in June, a slip from 50.8 in May.
Ongoing conflict in oil rich nations also kept Brent prices supported as investors worried about supply interruptions. After fighting in Libya's capital, Tripoli, Prime Minister Ali Zeidan announced that the nation's defense minister will be dismissed from his post.
Brent also saw gains from news that one of the largest and most important oil fields in the North Sea, British Buzzard oil field, was expected to run at reduced capacity for around five days. The oil field will reduce production to just 170,000 barrels per day.
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