WTI crude falls from two-week high as China factory output slows

West Texas Intermediate crude (NYMEX:CLG14) slid from the highest closing price in two weeks amid slowing economic growth and weaker industrial output in China, the world’s second-biggest oil consumer.

Futures lost as much as 1% in New York. Factory production rose by 9.7% in December, the slowest expansion in five months, according to China’s National Bureau of Statistics. Iran’s Atomic Energy Organization chief welcomed the start of the implementation of an interim nuclear deal with world powers that will see the Gulf state curb its atomic program in exchange for sanctions relief.

“The modest, tepid Chinese economic data surprised investors and is bringing more uncertainty about the prospects for the Chinese economy in the medium term,” said Myrto Sokou, senior analyst at Sucden Financial Ltd. London. “Signs about the situation with Iran’s nuclear program are also going to provide momentum in the coming days.”

WTI for February delivery fell as much as 94 cents to $93.43 a barrel in electronic trading on the New York Mercantile Exchange and was down 0.7% at $93.72 when trading ended at 1:15 p.m. New York time. The contract, which expires tomorrow, climbed 41 cents to $94.37 on Jan. 17, the highest close since Jan. 2. The more-active March future was down 56 cents at $94.03.

The volume of all contracts traded was 83% below the 100-day average. Floor trading was closed for the Martin Luther King Jr. holiday in the U.S. and transactions will be booked with tomorrow’s trades.

Brent Slips

Brent for March settlement sank 13 cents to $106.35 a barrel after dropping as much as 67 cents on the London-based ICE Futures Europe exchange, on volume that was 55% below the average. The European benchmark crude was at a $12.32 premium to WTI for the same month.

Iran, fifth-biggest member in the Organization of Petroleum Exporting Countries, “will voluntarily suspend the enrichment of uranium at a 20% level” in its Natanz and Fordo facilities, Ali Akbar Salehi said in an interview on state television, according to the Iranian Students News Agency.

China’s economy expanded by 7.7% in the October- December period from a year earlier, compared with 7.8% in the third quarter, according to the statistics bureau in Beijing. Annual expansion of 7.7% in 2013 was the same pace as the previous year, which was the weakest since 1999.

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