Factory weakness weighs on Oil 05/01/2015

Factory weakness weighs on Oil

05/01/2015 09:17
Crude oil futures ended lower in the domestic market on Friday as investors and speculators exited positions in the energy commodity which hit the lowest level since May 2009 in the overseas market after tepid factory data from the US to the Euro area signaled a bearish demand outlook for the fuel while Russia and Iraq boosted production, widening a global supply glut. Manufacturing activity in the US expanded at the slowest pace in six months in December, signaling easing growth in the world's biggest economy. The ISM's factory index fell to 55.5 last month from 58.7 in November, with a reading above 50 signaling expansion. The Euro area manufacturing gauge stood at 50.6 in December, near the no-change mark of 50, but slightly up from November's 50.1. Oil production in Russia and Iraq rose to the highest level in decades in December, data from both countries showed, raising oversupply concerns. Crude futures may continue the downward slide today amid speculation of a global supply glut. At the MCX, Crude oil futures, for the January 2015 contract, closed at Rs 3,391 per barrel, down by 0.26 per cent, after opening at Rs 3,419, against the previous close price of Rs 3,400. It touched an intraday low of Rs 3,323 till the closing.