Oil down as China factory data shows weakening economy

Oil prices fell on Monday as China’s economic growth outlook dimmed amid the country’s new pandemic mitigation measures, as recent data showed the country’s factory and service activity contracted in October.

International benchmark Brent crude traded at $92.77 per barrel at 9.23 a.m. local time (0623 GMT) for a 1.06% decrease from the closing price of $93.77 a barrel in the previous trading session.

American benchmark West Texas Intermediate (WTI) traded at $87.06 per barrel at the same time for a 0.95% loss after the previous session closed at $87.90 a barrel.

China’s official manufacturing purchasing managers’ index (PMI) decreased from 50.1 in September to 49.2 in October.

The official non-manufacturing PMI, which measures business confidence in the construction and services sectors, also showed a fall from 50.6 in September to 48.7 in October.

China’s ‘Zero-Covid’ policy, which continues to impose restrictions, is a major contributor to the country’s deteriorating economy.

‘The market remains wary of the impending deadlines for European purchases of Russian crude before the sanctions kick in on 5 December,’ Australia and New Zealand Banking Group (ANZ) Commodity Strategist Daniel Hynes said in an emailed note.

• Oil prices fell