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Oil prices drop on China demand worries

Published 02/11/2015, 11:36 am
Updated 02/11/2015, 11:39 am
© Reuters.  Oil prices drop on China demand worries
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By Henning Gloystein

SINGAPORE, Nov 2 (Reuters) - Oil prices fell in early trading in Asia on Monday as analysts expected weaker demand from China in upcoming months.

Benchmark U.S. crude futures CLc1 were down 41 cents from their last settlement at $46.18 per barrel at 0025 GMT. Internationally traded Brent futures LCOc1 were at $49.33 a barrel, down 23 cents.

Monday's falls came after gains made last week following a further decline in the U.S. oil rig count which indicated that domestic crude production could drop in coming months. urn:newsml:reuters.com:*:nL3N12U1X4

But in Asia, the possibility of slowing demand in China dominated trade on Monday, with growth faltering in the world's No.2 economy.

"Weak economic data out of China will likely keep any gains in commodity prices limited," ANZ said.

Barclays (L:BARC) said that China's oil demand growth for September, adjusted for inventories, slowed to 226,500 barrels per day (bpd), or 2.1 percent, compared with the same month last year, much lower than the 6.3-percent gain registered for the first three quarters of the year.

"The strong demand data in the first eight months was inconsistent with the observed slowing macroeconomic activity, while the weak number in September better reflected real demand," the bank said.

"Fundamentals suggest moderate demand ahead, in our view," it added.

DATA/EVENTS

* The following data is expected on Monday (GMT):

0145 China

Caixin manufacturing PMI final

Oct

0850 France

Markit manufacturing PMI

Oct

0855 Germany

Markit manufacturing PMI

Oct

0900 Euro zone Markit manufacturing PMI final

Oct

1500 U.S.

ISM manufacturing PMI

Oct

1500 U.S.

Construction spending

Sep

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