Oil rises above $82 a barrel in Europe as Chinese manufacturing growth gains momentum. Oil prices rose above $82 a barrel Monday as the dollar weakened and regional stock markets jumped on news that growth in Chinese manufacturing picked up pace in October.
By early afternoon in Europe, benchmark crude for December delivery was up 76 cents at $82.19 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 75 cents to settle at $81.43 on Friday.
The pickup in Chinese manufacturing suggests that China’s economic recovery remains on track, bolstering expectations that its demand for crude will offset weakness in advanced economies.
The figures boosted Asian and European stock markets which were mostly higher Monday.
Crude has been stuck in a range of about $80 to $83 a barrel for the past week, as traders and investors wait for the Federal Reserve to say what it will do to stimulate the U.S. economy.
Expectations the Fed will Wednesday announce a Treasury bond buying program to pump money into the ailing economy were reinforced by lackluster third quarter U.S. growth figures released last week.
«Ongoing high interest of financial investors is still keeping oil prices from falling at the moment,» said a report from Commerzbank in Frankfurt. «The Federal Reserve’s meeting midweek is very important for the oil market. If the Fed’s measures fall short of the high market expectations, this could bring disappointment to the financial markets and allow oil prices to drop under the $80 mark again.»
A softer dollar also helped sustain oil prices by making crude cheaper for investors holding other currencies. The euro rose to $1.3943 on Monday from $1.3897 late Friday in New York, while the British pound was up at $1.6076 from $1.6021.
In trading in other Nymex December contracts, heating oil was up 1.69 cents to $2.2546 a gallon. Gasoline gained 2.37 cents to $2.0831 a gallon and natural gas added 8.4 cents to $4.122 per 1,000 cubic feet.
In London, Brent crude was up 77 cents at $83.92 a barrel on the ICE Futures exchange.
AP