22 March 2012 15:29 [Source: ICIS news]
LONDON (ICIS)--Crude oil futures weakened on Thursday, pressured by negative economic data from China, along with South Korea signalling support for the release of oil from strategic reserves.
By 14:20 GMT, the front-month May NYMEX WTI contract had reached an intra-day low of $104.50/bbl, a loss of $2.77/bbl compared with Wednesday's settlement of $107.27/bbl. The contract subsequently regained some of the losses to trade around $104.90/bbl.
At the same time, the May ICE Brent contract fell to an intra-day low of $122.30/bbl, a loss of $1.90/bbl compared with the Wednesday settlement of $124.20/bbl.
HSBC's preliminary March purchasing managers index (PMI) for China fell to a four-month low of 48.10, down from 49.60 in February.
PMI is a barometer of a country's manufacturing activities. A figure above 50 indicates an expansion in the sector, while a figure below 50 represents a contraction.
Following an agreement by the UK and the US to consider releasing oil from strategic reserves, South Korea is the latest member country of the International Energy Agency (IEA) to back such a move to help curb the rise in oil prices.
Despite much talk of releasing oil from strategic reserves, the IEA has not yet asked any member country to release oil from their strategic reserves.
The last time strategic reserves were released was in June 2011, when 60m bbl of crude oil and petroleum products were released to counter a shortfall in exports from Libya.
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