Oil prices slide on weak Chinese growth data, eurozone woes

18th October 2011, Comments 0 comments

Oil prices slid for a second day running Tuesday as weaker-than-expected Chinese economic growth data sparked concern over a slowdown in demand from the world's top consumer of energy.

Sentiment took another hit after ratings agency Moody's warned that France's top-level credit rating could be put on negative outlook, sparking new concern over the eurozone debt crisis ahead of a key EU summit this weekend.

New York's main contract, light sweet crude for delivery in November, shed 44 cents to $85.94 a barrel.

Brent North Sea crude for delivery in December fell 84 cents to $109.32 a barrel in London midday trade.

China announced on Tuesday that its economic growth slowed to 9.1 percent in the third quarter as government efforts to tame inflation and turbulence in Europe and the US curbed activity.

Growth in the world's second-largest economy slowed from 9.5 percent in the second quarter to its lowest rate in two years, the National Bureau of Statistics (NBS) revealed.

China's economic growth has a direct impact on crude prices and demand, as it is the world's largest energy consumer according to the International Energy Agency.

Crude futures had sunk on Monday after the weekend Group of 20 meeting in Paris failed to solidify market confidence in the global growth picture and Europe's financial soundness.

Traders are now worried that EU leaders may fail to unveil firm plans to resolve the eurozone debt crisis when meeting at a summit in Brussels on October 23.

Ahead of the crunch summit, Moody's on Monday warned that it could decide to place a negative outlook on France's top-level Aaa credit rating in the coming months as the government's financial strength "has weakened".

© 2011 AFP

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