Oil dips following weak US economic data

Brent’s price felt some downward pressure, after manufacturing PMI in the US, the world's largest oil consumer, came in below expectations in September.

PHOTO: Oil pump jacks with the US flag in the background. Getty Images

The US Manufacturing Purchasing Managers' Index (PMI) reading remained at 47.2% in September, unchanged from the previous month, the Institute for Supply Management (ISM) reported.

The data has indicated sluggish growth in the country’s manufacturing sector, while market analysts expected a better outcome.

Earlier this week, China, the world’s second-largest oil consumer, reported a weaker-than-expected manufacturing PMI, reaching 49.8% in September.

A PMI reading below 50 typically indicates weak economic health and a contraction in the manufacturing sector, which includes production, inventory levels, new orders, etc. It also highlights demand growth concerns, ultimately weighing down on prices of commodities like oil.

By Aparupa Mazumder

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