Oil prices soar on upbeat US, Chinese data

1st September 2010, Comments 0 comments

Oil prices powered higher on Wednesday in the wake of strong manufacturing data in leading energy consumers China and the United States.

Brent North Sea crude for delivery in October was up 1.93 dollars at 76.57 dollars a barrel in late London trade.

New York's main contract, light sweet crude for October, jumped 2.13 dollars to 74.05 dollars.

"The financial markets have decided to ignore the negative news that (US) private employment may have contracted in August and are concentrating on the unexpected rebound in the ISM manufacturing index last month," said Capital Economics analyst Paul Ashworth.

The US manufacturing sector expanded for the 13th straight month in August, beating most analysts' expectations.

The Institute of Supply Management said its manufacturing index rose to 56.3 points from 55.5 percent in July, trumping forecasts for a fall to 52.9 percent.

A reading above 50 percent indicates an expanding manufacturing sector.

Earlier on Wednesday, official data showed manufacturing had also strengthened in China -- the world's second biggest energy-consuming nation after the United States.

Later on Wednesday, the oil market shrugged off data from the US Department of Energy that showed American crude inventories jumped 3.4 million barrels last week -- far higher than the 800,000 barrel rise predicted by analysts.

Oil prices fell sharply on Monday and Tuesday as traders fretted over the pace of the US economic recovery and growing fuel inventories.


© 2010 AFP

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