Oil eases in Asia on weaker Chinese factory output

I / Singapore June 11, 2010, 10:26 IST

Oil prices eased in Asian trade today as weaker Chinese factory output in May dampened investor sentiment, analysts said.

New York's main futures contract, light sweet crude for delivery in July, shed 32 cents to $75.16 while Brent North Sea crude for July was off 31 cents at $74.98.

Industrial output from China's millions of factories and workshops rose 16.5 per cent in May, slower than April's increase of 17.8 per cent, the National Bureau of Statistics said today.

"There might be some caution due to the Chinese industrial production data, which was slightly lower than expectations," ANZ bank oil analyst Serene Lim said.

"But overall their economic numbers look strong and there is some risk of overheating," she said.

China is the world's second-biggest oil consumer after the United States, and its economic data now have a significant impact on the market for crude.

Lim said investors were also taking profits after crude prices rallied in recent sessions.

Yesterday, the International Energy Agency hiked its estimate for global oil demand this year by 60,000 barrels per day to 86.4 million bpd. Economic data in advanced countries was proving stronger than expected, it said.