West Texas Intermediate crude was little changed as data from China and Europe signaled a slowdown in global manufacturing and equities climbed for a third day.
Oil slipped 1 cent as China’s preliminary manufacturing data for April showed expansion was less than in March. Euro- area output shrank for a 15th month. U.S. oil supplies probably rose to the most since 1990 last week, a Bloomberg survey showed before a government report tomorrow. Equities gained on better- than-expected corporate earnings and U.S. new-home sales. Crude briefly extended losses as stocks tumbled just after 1 p.m. in New York on a false report of a bombing at the White House.
“The Europe and China numbers are rather weak,” said Tariq Zahir, a New York-based commodity fund manager at Tyche Capital Advisors. “The equities definitely helped oil today but I do think we will continue to go lower. We had that blip due to the false White House headline. It looked like there was some high-frequency trading going on.”
West Texas Intermediate for June delivery settled at $89.18 a barrel on the New York Mercantile Exchange. Prices have dropped 8.3 percent this month and 2.9 percent this year. The volume of all futures traded was 19 percent above the 100-day average for the time of day at 3:45 p.m.
Brent for June settlement fell 8 cents to end the session at $100.31 a barrel on the ICE Futures Europe exchange. The volume of all contracts traded was 4 percent above the 100-day average.
“The manufacturing numbers were really what hurt the market,” said Bill Baruch, a senior market strategist at commodities trading firm Iitrader.com in Chicago. “Some of the earlier pressure has been relieved.”
The preliminary reading of 50.5 for a Purchasing Managers’ Index in China released by HSBC Holdings Plc and Markit Economics compared with a final 51.6 for March. The number was also below the median 51.5 estimate in a Bloomberg survey of 11 analysts.
Goldman Sachs Group Inc. cut its 2013 Brent price forecast to $105 from $110 in a report today by analysts including Jeffrey Currie in New York. They highlighted the increased risk that Chinese demand growth will remain weak in the near-term.
The International Energy Agency and the Organization of Petroleum Exporting Countries reduced their 2013 global oil- consumption estimates earlier this month.
“China gives more downside risk to these demand forecasts,” said Jacob Correll, a Louisville, Kentucky-based analyst at Summit Energy Inc., which manages more than $20 billion in companies’ annual energy spending.