Brent crude oil moved toward $101 on Wednesday morning after falling to a 16-month low Tuesday because of waning demand.
The commodity traded at $100.75 at 6:20 GMT following strong manufacturing data from the United States and news of longer than expected refinery maintenance.
Data out on Tuesday contributed to growing concern that the global economy will not promote increased oil consumption. Both China and the eurozone posted lackluster manufacturing growth, leading to questions of whether either economy will be able to turn itself around.
The eurozone’s manufacturing PMI figure barely made it above the 50-point mark that denotes growth, something that will put more pressure on the European Central Bank to ease further at its September policy meeting on Thursday. The eurozone has been struggling this year as high unemployment and dangerously low inflation figures plague the region’s sputtering recovery.
Related Link: Euro Remains Below .32 With ECB Meeting On The Horizon
The conflict in Ukraine is also contributing to worries about global growth, as the United States and the EU are considering more sanctions against Russia amid accusations that Moscow is sending troops and weapons across the Ukrainian border in support of the separatists. Russia has threatened to retaliate with sanctions of its own if more limits are imposed, something that could have a large impact on the eurozone as one of its largest trading partners.
Brent found some support from strong U.S. manufacturing activity that suggested the number one oil consumer would have a healthy crude appetite moving forward. The nation’s PMI was up to 59.0 in August, the highest reading in more than three years and a huge jump from July’s 57.1 reading.
Also helping Brent prices was refinery maintenance at the Buzzard oilfield in the North Sea. Reuters reported that Nexen has estimated that the plant will be closed for 10 days. The 200,000 barrel per day plant was closed on August 30 for planned maintenance.
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