Oil stabilized in choppy trade on Monday, with data showing demand from China remaining lackluster in September and a strong U.S. dollar weighing, while weakening data on trade activity in the states US dampened expectations of a more aggressive rise in interest rates and a limited decline in prices.

Brent crude futures for December delivery settled at $93.26 a barrel, down 24 cents, 0.3%, after rising 2% last week. U.S. West Texas Intermediate crude fell $84.58 a barrel, down 47 cents, 0.6%. Both benchmarks had fallen $2 a barrel earlier in the session.

Although higher than August, China’s September crude imports, at 9.79 million barrels per day, were 2% lower than a year earlier, customs data showed on Monday, as independent refiners cut throughput amid thin margins and lackluster demand.

“The recent recovery in oil imports faltered in September,” ANZ analysts said in a note, adding that independent refiners did not use the quota increase as ongoing COVID-related lockdowns weighed on oil. Requirement.

Uncertainty around China’s zero-COVID policy and housing crisis are undermining the effectiveness of pro-growth measures, ING analysts said in a note, even as third-quarter gross domestic product growth topped expectations.

The continued strength of the US dollar, which rose again for part of the trading session following another suspected foreign exchange intervention by Japan, also posed problems for oil prices. read more A stronger dollar makes oil more expensive for non-US buyers.

“Further dollar strength would weigh on WTI values ​​with a test of our expected decline to the 79.50 mark likely by the end of the week,” said Jim Ritterbusch of Ritterbusch and Associates.

Oil prices regained ground after data showed U.S. business activity contracted for a fourth straight month in October, with manufacturers and services firms in a monthly survey of purchasing managers saying state of weaker customer demand.

POSITIVE SIGNAL

S&P Global said its flash U.S. composite PMI production index, which tracks the manufacturing and services sectors, fell to 47.3 this month from a final reading of 49.5 in September.

The weakening could indicate that the US Federal Reserve’s interest rate hikes to fight inflation have worked and could persuade it to slow down its rate hike policies, a positive signal for fuel demand, Phil said. Flynn, an analyst with the Price Futures group.

“The lack on the PMI number is a sign that the economy may be slowing down a bit, which turns out to be bullish,” Flynn said.

Brent crude rose last week despite US President Joe Biden’s announcement to sell the remaining 15 million barrels of oil from the Strategic Petroleum Reserves, part of a record 180 million barrel release that saw started in May.

Biden added that his goal would be to rebuild inventories when U.S. crude nears $70 a barrel.

But Goldman Sachs said the release of stocks is unlikely to have a big impact on prices.

“Such a release is likely to have only a modest influence (Source: Reuters (additional reporting by Noah Browning and Florence Tan; editing by Marguerita Choy, David Holmes and Cynthia Osterman)

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