Crude prices edged up despite weak data from China as investors were hoping for stimulus plans from the Federal Reserve. In the earlier trading, crude prices were pressured by the weak trade data from the world second largest oil consumer of China. Statistics released on Monday showed that Chinese imports fell 2.6 percent year on year in August, far below the expectations of a 3. 5 percent rise. Meanwhile, exports grew 2.7 percent, also missing the forecasts of a 3 percent increase. But investors were hoping that more and more economic darkening signs will trigger another round of quantitative easing from the Fed.
In the Middle East, Saudi Oil Minister Ali al-Naimi said on Monday Saudi Arabia was concerned about the high oil prices and would take necessary steps to increase outputs. But he thought the rising prices were “simply not supported by market fundamentals. Just a few months ago Saudi Arabia became the number one producer of oil. Prices earlier declined on comments by Saudi Arabia’s oil minister, that supply and demand fundamentals do not justify current high prices.
Crude oil futures recovered during closing trades, ending modestly higher as traders weighed evidence of lagging demand for the commodity in China and the likelihood of potential stimulus in the United States.
U.S. crude rose 12 cents on Tuesday, or 0.12 percent, to settle at $96.54 a barrel, after slumping to $95.34, with the session peak of $96.63 only 2 cents above the $96.61 200-day moving average. U.S. crude futures edged up on Monday, settling a few cents higher, as supportive expectations that the U.S. Federal Reserve would act to stimulate the economy countered pressure from weak Chinese data that raised concerns about demand for oil.
China’s crude oil imports declined 12.5 percent in August from a year earlier to the lowest daily rate since October 2010, while implied oil demand in the country dropped to 8.92 million barrels per day (bpd), underlining sputtering domestic demand as the global economic outlook darkens.
Natural gas futures closed higher for the first time in four sessions, driven by technical buying after last week’s slide and expectations for another light weekly inventory build.
Front-month gas futures on the New York Mercantile Exchange ended up 13 cents, or 4.8 percent, at $2.812 per million British thermal units after trading between $2.647 and $2.835.