Oil recovers as upbeat Chinese manufacturing data increases some optimism
Shafaq News/Prices rose after official data on Saturday that showed that China'smanufacturing activity expanded at the fastest pace in three months in Februaryas new orders and higher purchase volumes led to a solid rise in production.Investors are eyeing China's annual parliamentary meeting, which starts March5, for further measures to support its battered economy.
IG marketanalyst Tony Sycamore said one of the possible drivers for rising prices wasthat "the China NBS manufacturing PMI moved back into expansionaryterritory over the weekend".
However, hecautioned that the country's economic outlook may not be inspiring, withanother round of tariffs on exports to the U.S. set to start on March 4.
Analystsfrom Goldman Sachs were somewhat more positive about the data, saying in a noteit suggests stable to slightly better economic activity in China in early 2025,although the imposition of the extra 10% U.S. tariff may prompt retaliatorymeasures.
Last month,Brent and WTI posted their first monthly declines in three months as the threatof tariffs from the U.S. and its trade partners shook investors' confidence inglobal economic growth this year and reduced their appetite for riskier assets.
Overallsentiment improved after a summit on Sunday where European leaders offered astrong show of support for Ukrainian President Volodymyr Zelenskiy and promisedto do more to help his nation, just two days after U.S. President Donald Trumpclashed with him, and Zelenskiy cut short a visit to Washington.
Zelenskiysaid on Sunday that he believed he could salvage his relationship with Trumpbut that talks needed to continue behind closed doors. He added that heremained ready to sign a minerals deal with the United States, and he believedthe U.S. would be ready as well.
"It's unclearwhere the U.S. now stands, making a peace deal seem more distant than a weekago," ING analysts led by Warren Patterson said in a note. "This isaltering energy-market hopes for an easing of sanctions."
In addition,ongoing attacks at Russian refineries have raised concerns about its refinedproducts exports, with another plant in the Russian city of Ufa reportedly onfire.
For 2025,analysts are holding their oil price forecasts largely steady, with Brentaveraging at $74.63 a barrel, as they expect any impact from further U.S.sanctions to be balanced by ample supply and a possible peace deal betweenRussia and Ukraine, a Reuters poll showed.
Although theU.S. is urging Iraq to resume exports from the semi-autonomous Kurdistanregion, eight international oil firms operating there said on Friday they wouldnot restart shipments through Turkey's port of Ceyhan due to a lack of clarityon commercial agreements and guarantees of payment for past and future exports.
(Reuters)
