Oil prices tumbled in Asia today, with Brent falling below $100 a barrel, on demand fears after Chinese growth data indicated a pick-up in the world’s number two economy remained fragile.
New York’s main contract, light sweet crude for delivery in May, dropped $1.04 to $87.67 a barrel, while Brent North Sea crude for May contract, shed $0.99 to $99.64 in the afternoon trade. Brent is below $100 for the first time since July.
“The market is mainly still reacting to the poor GDP numbers out of China, which has reaffirmed the trend that the world’s second-biggest economy is slowing,” David Lennox, resource analyst at Fat Prophets in Sydney, said.
Data showed that growth in China eased to 7.7 per cent in the first quarter below forecasts for 8 per cent.
“Many had called the bottom for China’s economy and with Europe languishing with low growth, many had pinned consumption and demand to be driven by China,” Jason Hughes, head of sales trading at CMC markets in Singapore, wrote in a note. “This now seems to be perhaps a bit too optimistic.”
The market was also weighed by disappointing data from the US, analysts said.
April data showed a larger-than-expected slowdown in New York state manufacturing and a drop in confidence of US homebuilders.
Oil prices have been under pressure after forecasts last week of lower global demand by the Organisation of Petroleum Exporting Countries, the International Energy Agency and the US government’s Energy Information Administration.