Wednesday, October 03 11:35:04
Crude oil prices fell today, as weak data from Europe and China dimmed the outlook for demand, while Europe's festering debt crisis added to the gloom.
Brent November crude futures had fallen 96 cents to $110.61 a barrel by 1000 GMT. They ended Tuesday below two critical technical levels -- the 50-day moving average at $112.06 and the 200-day moving average at $112.09.
U.S. November crude shed 56 cents to $91.33 a barrel.
China's official purchasing managers' index for the services sector fell to 53.7 in September from 56.3 in August as growth in the manufacturing industry stabilised at a slower pace.
In Europe dwindling new orders and faster layoffs marked a worsening decline for euro zone companies last month, according to business surveys that dent hopes the economy will return to growth before 2013.
Wednesday's purchasing managers indexes (PMIs) suggested it was almost inevitable the euro zone returned to recession in the third quarter.
"There's little to be cheerful about. There's worry about whether Spain will ask for a bailout or not and there's major uncertainty around China," said Filip Petersson, analyst at SEB in Stockholm. "It's difficult to be bullish at the moment."
Oil prices are still more than $20 a barrel higher than they were in June as fears about conflict in the Middle East have kept concern about supply disruption simmering.
Investors were increasingly convinced that a dispute over Iran's nuclear programme will drag on.
"Prices are not going to fall that far, as the situation between Iran and Israel will keep the heat under the market until the end of the year," Tony Nunan, oil risk manager at Mitsubishi Corp in Tokyo said.
Data from the American Petroleum Institute showed that inventories rose less than expected last week, adding 462,000 barrels, against expectations for a build of 1.5 million barrels.
The U.S. Energy Information Administration (EIA) releases its weekly estimates on Wednesday at 1430 GMT. (C ) Reuters