U.S. benchmark WTI prices reclaim $40 mark, a day after settling at lowest in a week


Oil futures finished higher on Tuesday, with U.S. prices reclaiming the $40 mark a day after settling at their lowest in a week, as data showed a jump in Chinese crude imports.

West Texas Intermediate crude for November delivery rose 77 cents, or nearly 2%, to settle at $40.20 a barrel on the New York Mercantile Exchange. The global benchmark, December Brent crude, tacked on 73 cents, or almost 1.8%, to $42.45 a barrel on ICE Futures Europe reported MarketWatch.

“Chinese crude oil imports rose to the equivalent of 11.8 million barrels per day in September, putting them 2% up on the previous month,” said Carsten Fritsch, analyst at Commerzbank, in a note. “The anticipated cooling following the buying spree in the (early) summer has yet to materialize, in other words,” he said. “Chinese crude oil imports were 12.7% up year-over-year in the first nine months.”

However, Fritsch argued the strong Chinese demand is unlikely to offset a range of bearish factors over the longer run.

These include a sharp jump in Libyan crude production as its largest oil field comes back online, which could double the country’s crude production to 650,000 barrels a day within a few weeks, he said. The end of a Norwegian oil strike and the return of production in the Gulf of Mexico were also credited for Monday’s crude selloff.

Source: MarketWatch