Even with good global economic news, oil prices continue to drop.
China announced a better than expected manufacturing performance in March on Friday, but oil investors still weren’t convinced.
The country’s purchasing manager’s index (PMI) rose to 50.2 last month, up from February’s 49, which suggests its sluggish economy may finally be turning around.
The PMI is a series of economic indicators derived from monthly surveys of the private sector.
West Texas Intermediate (WTI) crude oil was at $37.66 (£26.29) as of 11:10 a.m. GMT (6:10 a.m. ET), down 1.77% from market opening. Brent crude oil, the European benchmark, was at $39.63 (£27.66), down 1.74% and once again below the $40 mark.
Concerns about oversupply still weigh hard on investors, and they may have taken their cue from Asian markets, which barely reacted to China’s PMI news.
“The lack of reaction is a littler perplexing,” Jonathan Barratt of Ayers Alliance told Reuters. “I think the lead will come out of the US.”
Here’s the look of WTI at 11:10 a.m. GMT (6:10 a.m. ET):
Here’s Brent’s drop at the same time:
Business Insider previously reported that the markets were in “wait and see” mode for oil.
Things weren’t helped by Kuwait and Saudi Arabia agreeing earlier this week to resume production at Khafji field, which will yield between 280,000 – 300,000 barrels of oil, contributing further to the global oversupply.
OPEC and other major oil suppliers, including Russia, are still due to meet in Qatar on April 17 to discuss the oil price crisis.