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Oil prices pull back on demand concerns

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Oil prices fell this afternoon under pressure from weak economic data that came out in the US and China, reinforcing fears of a global economic slowdown, which would reduce energy demand.

The final reading of HSBC’s China PMI index for September, a gauge of manufacturing activity in the world’s second largest energy consumer, came in at 49.9 this morning, signalling the third straight month of contraction in China’s manufacturing sector.

Likewise, today’s personal income and spending data from the US Commerce Department disappointed, revealing that growth in personal spending slowed from 0.7 percent in July to 0.2 percent in August as incomes declined 0.1 percent.

Futures for oil prices managed to claw back some of their losses later in the session when the University of Michigan said its consumer sentiment index climbed from 55.7 in August to 59.4 in September, a bigger decline than forecast by analysts.

The final reading of the Chicago PMI index for September also came in ahead of expectations at 60.4, suggesting that manufacturing activity in one of the main industrial regions in the US expanded at a rapid pace this month.

US light, sweet crude
for November delivery, currently the most actively traded contract on the New York Mercantile Exchange (NYMEX), fell 80 cents to US$81.34/barrel in morning trade in New York.

November Brent crude declined 81 cents to US$103.11/barrel on London’s ICE Exchange this afternoon.

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

Roxi Petroleum (LON:RXP)
, up 12 percent at 2.93 pence at midday

Amerisur Resources (LON:AMER), up 5.5 percent at 13.73 pence

3Legs Resources (LON:3LEG), up 4 percent at 188 pence

Oilex (LON:OEX), up 4 percent at 14.2 pence

Caza Oil & Gas (LON:CAZA), down 3 percent at 10.05 pence

The top fallers were:

Tower Resources (LON:TW.), down 12.5 percent at 3.84 pence at midday

Mediterranean Oil & Gas (LON:MOG)
, down 10 percent at 8.12 pence

Aurelian Oil & Gas (LON:AUL), down 9 percent at 17.75 pence

TXO (LON:TXO), down 8.5 percent at 0.55 pence

Afren (LON:AFR)
, down 8.5 percent at 83.45 pence

Quick facts: Brent Crude Oil

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LSE:BRENT
Market: LSE
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