US benchmark West Texas Intermediate for December delivery was down 69 cents to USD 81.40 a barrel in late- morning trade and Brent crude for December dropped 62 cents to USD 86.21. Both contracts rebounded sharply yesterday, buoyed by better-than-expected economic data from China and European powerhouse Germany.
British banking giant HSBC's preliminary manufacturing purchasing managers index (PMI) for China showed a slight uptick, to 50.4 in October from 50.2 in September, easing concerns about slowing economic growth in the world's largest energy consumer. Markit's PMI for Germany rose to 54.3 in October from 54.1 in September, with manufacturing rising at the fastest pace in three months but still well below the levels seen at the start of the year. For the 18-member eurozone, Markit said its Composite Purchasing Managers Output Index rose marginally to 52.2 points in October from a 10-month low of 52.0 points in September.
While the German and eurozone PMI are encouraging, analysts said they would wait for data in the next few months to make firm conclusions on its growth path. "So far, it seems quite good, but we still need to look at the the next few releases," Daniel Ang, investment analyst at Phillip Futures in Singapore, told AFP.
WTI has fallen two-year lows and Brent to its lowest levels in four years, pressured by a crude oversupply and weak demand from slowing world economies.