Brent Ends Losing Streak On Chinese Data
Brent crude oil ended its four day losing streak on Thursday after Chinese data restored hope that the global economy was on the mend and improved the future demand outlook. The commodity climbed toward $108 and traded at $107.44 at 8:25 GMT on Thursday morning.
After several weeks of questionable data, China seems to be getting back on track as imports and exports both rose beyond analyst expectations in July. Bloomberg reported that Chinese exports were 5.1 percent higher in July than they were at the same time last year. The figure far exceeded the 2 percent increase predicted by analysts who were taking into account June's 3.1 percent drop. Imports also improved and grew by 10.9 percent.
The data lent support to Brent prices as crude oil imports jumped to a record high of 6.15 million barrels per day. However, some worry that the sharp increase in oil imports could lead to growing stockpiles, which would decrease the nation's imports in coming months.
Gains from positive Chinese data were mitigated by renewed worries about the US Federal Reserve's decision to cut back on stimulus spending. Many are anticipating the Fed's stimulus tapering will begin as soon as next month, something that would reduce liquidity in the commodities market and boost the dollar's value.
Despite reassurance from Libyan officials, oil supply from the African nation has been more than halved due to protests which have shut down major oil fields. The demonstrations have kept the nation's oil shipments to a minimum since Tuesday and moving forward, further shutdowns are expected.
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