Crude Oil Loses Value on Global Manufacturing Slowdown
Crude oil futures slumped today as manufacturing was slowing last month in various countries across the world. The US manufacturing Purchasing Managers’ Index fell from 49.8 in July to 49.6 in August. The eurozone PMI was at 45.1, below the preliminary estimates. The HSBC China Manufacturing PMI from 49.3 to 47.6 last month — the lowest level since March 2009. Any reading below 50.0 indicates decline of the industry.
Prices for oil are heavily dependent on the performance of the global economy. Demand for crude falls as economy slows. The falling PMI figures are certainly telling investors that the global economy does not fare well.
Crude oil declined from $97.17 to $95.46 per barrel as of 19:05 GMT on NYMEX today. October futures for delivery of Brent crude dropped as much as $1.07 (0.9 percent) to $114.71 per barrel by 13:04 on ICE today.
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