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Oil prices fall on weak US and China data

Last updated: 16:28 01 Jun 2012 BST, First published: 20:28 01 Jun 2012 BST

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Oil prices fell sharply today with Brent crude slipping below US$100 per barrel after dismal employment data added to concerns about the strength of the economic recovery in the US.

The US economy created only 69,000 jobs last month and the unemployment rate rose to 8.2 percent from 8.1 percent, today’s report from the Department showed.

Expectations were for a gain of 150,000 in payrolls and no change to the jobless rate.

The jobs data triggered speculation that the Federal reserve may discuss launching another round of quantitative easing to support the economic recovery at the next policy meeting in mid June.

Earlier in the session, China’s official manufacturing figures showed that the sector expanded at a much slower pace in May than it did in April with the PMI index falling to 50.4 from 53.3.

The data was seen as another sign that growth in the world’s second largest economy is slowing faster than expected.

Oil prices were also pressured by this week’s oil inventories data from the Department of Energy, which revealed a gain of 2.2 million barrels in America’s crude stocks compared with forecasts of an increase of only one million.

US light, sweet crude for July delivery, currently the most actively traded contract on the New York Mercantile Exchange (NYMEX), slipped US$2.57 to US$83.96/barrel in morning trade in New York.

July Brent crude slumped US$2.78 to US$99.09/barrel on the ICE Exchange this afternoon.

Today’s top risers in the oil and gas sector were:

Mediterranean Oil & Gas (LON:MOG), up 15.5 percent at 6.5 pence at midday

Serica Energy (LON:SQZ), up 10.5 percent at 26 pence

Sound Oil (LON:SOU), up 10.5 percent at 1.08 pence

The top fallers were:

Leni Gas & Oil (LON:LGO), down 15 percent at 0.66 pence at midday

Xtract Energy (LON:XTR), down 11 percent at 0.48 pence

Afren (LON:AFR), down 9.5 percent at 104.9 pence

Borders & Southern Petroleum (LON:BOR), down 6.5 percent at 67.25 pence

Rockhopper Exploration (LON:RKH), down 6 percent at 283.5 pence

 

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