Crude oil futures slump as global growth concerns weigh

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Forexpros - Crude oil futures were down on Tuesday, pulling back from the previous session's seven-day high as concerns that the global economic recovery was stalling weighed on future oil-demand expectations.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in October traded at USD87.08 a barrel during European morning trade, falling 0.69%.

It earlier fell as much as 0.9% to trade at a daily low of USD86.82 a barrel.

Preliminary data released earlier showed that German economic growth nearly stalled during the second quarter, increasing by a seasonally adjusted 0.1%, below expectations for a 0.5% increase.

A separate report showed that the euro zone's gross domestic product increased by a seasonally adjusted 0.2% during the second quarter, slowing from growth of 0.8% in the preceding quarter and below expectations for a 0.3% gain.

The downbeat data comes after the New York Federal Reserve said on Monday that its index of manufacturing conditions in New York State fell by 3.9 points to minus 7.7 in August, contracting for the third consecutive month.

Energy traders pay close attention to manufacturing numbers, as they are used as indicators for future fuel demand growth.

Meanwhile, markets were awaiting fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of oil demand in the world's largest oil consumer.

The American Petroleum Institute will release its inventories report later in the day, while Wednesday's government report could show crude stockpiles declined by 0.7 million barrels last week, while gasoline stockpiles were projected to fall by 2.0 million barrels.

Strength in the U.S. dollar also weighed on crude prices, as the dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.28% to hit 74.14.

Dollar-denominated oil futures contracts tend to fall when the dollar gains, as this makes oil more expensive for buyers in other currencies.

Elsewhere, on the ICE Futures Exchange, Brent oil futures for October delivery dropped 1.05% to trade at USD108.67 a barrel, up USD21.59 on its U.S. counterpart.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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