Brent Slips Towards $109 On Demand Worries
Brent crude oil slipped on Thursday morning as investors worried about falling demand. Supply interruption worries helped mitigate some of the losses and kept the commodity trading at $109.30 at 7:30 GMT on Thursday morning.
With the severely cold winter in the US coming to a close, many are expecting to see crude demand taper off. Additionally, poor economic data from China has many worried that the world's second largest oil consumer may not have such a large appetite for crude.
Reuters reported that China's factory activity is expected to have grown only slightly in February. The nation's manufacturing purchasing managers' index is forecast to fall to 50.1, down from 50.5 in January. If the prediction is correct, it will mark an eight month low for China's manufacturing PMI and would indicate that the nation's slowdown is set to continue.
However, tension over Ukraine's faltering economy has kept prices supported as many worry that the conflict could grow into a larger problem. Russian President Vladimir Putin has sent troops to perform military exercises in western Russia, some just miles from the border of Ukraine. The development prompted the US to issue a statement to Putin, warning him against military intervention.
Also supporting Brent prices is geopolitical tension in Libya where the nation's government is struggling to restore order to the country. Libyan oil output has been depressed for months now as protesters shut down the nation's largest export terminals in a bid for more rights as well as access to a portion of the nation's oil revenue.
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