Oil prices nearly unchanged after volatile week

PanARMENIAN.Net - The price of oil was nearly unchanged Monday, Sept 23, with traders taking a breath following a volatile week, the Associated Press reports.

Benchmark oil for November delivery was up 3 cents to $104.78 at midday Bangkok time in electronic trading on the New York Mercantile Exchange. It was just a tiny bounce back from Friday, when the now expired contract for October delivery dropped $1.72 to close at $104.67.

Progress in reaching a deal overseen by the U.S. and Russia to eliminate Syria's chemical weapons is helping to keep oil prices in check.

Concerns about a possible shutdown of the U.S. government if Congress fails to raise the debt ceiling by Oct1 offset positive data from China showing growth in manufacturing.

Last week, oil dropped $3.54, or 3.3 percent. There was a midweek blip, however, when prices shot up 2.5 percent on Wednesday following the U.S. Federal Reserve's decision to keep its economic stimulus policy in place.

Brent crude, the benchmark for international crudes used by many U.S. refineries, was unchanged at $109.22 a barrel on the ICE Futures exchange in London.

Meanwhile, global banking giant HSBC said Monday its preliminary purchasing managers' index for the manufacturing sector in China hit 51.2 in September, the highest since March when the index stood at 51.6.

It was higher than last month's final reading of 50.1, which improved from an 11-month low of 47.7 in July and ended three months of contraction, according to the bank.

A PMI reading above 50 indicates growth, while anything below signals contraction.

"There is an upbeat sentiment about demand for crude in China, especially with the Chinese government providing support in the money markets and allowing corporations to pick up speed," Kenny Kan, market analyst at CMC Markets in Singapore, told AFP.

Chinese authorities have so far been reluctant to introduce large-scale stimulus measures, but in late July did announce some steps to boost growth, such as reducing taxes on small companies and encouraging railway development.