Oil steady as US, China manufacturing improves
The price of oil was steady above $96 a barrel on Tuesday, supported by expanding manufacturing output in the world's two largest economies and ahead of the release this week of several key U.S. economic indicators.
By early afternoon in Europe, benchmark oil for March delivery was up 5 cents to $96.50 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 56 cents to finish at $96.44 a barrel on the Nymex on Monday.
On Monday, the U.S. reported that demand for long-lasting manufactured goods rose sharply in December. That comes on top of an improved housing picture and strong earnings by major companies. Many analysts think the economy's sluggish recovery will pick up stream by 2014.
China's manufacturing activity has also recently rebounded as the country emerges from its deepest slump since the 2008 global financial crisis. Analysts have all but stopped predicting that the world's No. 2 economy will have a "hard landing," or a sharp downturn.
"Oil prices are continuing to profit from the brightening of market sentiment," said a report from Commerzbank in Frankfurt. "However, as compared to equity markets, which are trading at multi-year highs, oil prices have underperformed of late and therefore have catch-up potential."
It's a big week for U.S. economic indicators. The government will release reports on weekly jobless claims, unemployment and fourth-quarter growth. And the Federal Reserve's policy committee holds a two-day meeting that concludes on Wednesday.
Brent crude, used to price international varieties of oil, was down 12 cents to $113.36 a barrel on the ICE Futures exchange in London.
In other energy futures trading on Nymex:
— Wholesale gasoline declined 1.31 cents to $2.9278 per gallon.
— Natural gas lost 5.4 cents to $3.235 per 1,000 cubic feet.
— Heating oil retreated 0.11 cent to $3.0532 a gallon.
Pamela Sampson in Bangkok contributed to this report.