Crude oil futures were in decline today after China said that its oil imports hit 18 month lows in October sliding to 16.1 million metric tonnes, which translates into 3.8 million barrels per day.
China’s imports hit historic highs in September, when they reached 22.9 metric tonnes.
Meanwhile, the US dollar continued rising, taking its winning streak to three days and making the dollar-denominated oil more expensive for holders of other currencies, denting demand.
Traders are looking to today’s inventories data from the US Department of Energy.
Yesterday’s report from the American Petroleum Institute (API) showed that crude stockpiles in the US shed 7.4 million barrels last week.
Oil prices will rise substantially by 2012, Goldman Sachs (NYSE:GS) said in a report yesterday. The investment bank reiterated its predictions that oil supplies in the US will decline as global economic growth will drive up energy demand.
“We continue to expect improving fundamentals will provide additional support to prices,” said Goldman.
Oil prices rallied to two year highs after the Federal Reserve unveiled a fresh US$600 billion stimulus package in hopes to spur the slowing recovery earlier this month.
The asset purchase round is expected to lead to higher levels of economic activity and increase the demand for crude oil.
US light, sweet crude for December delivery declined to US$87.04/barrel, while January crude fell to US$87.52/barrel on the New York Mercantile Exchange (NYMEX).
December Brent Crude retreated to US$88.13/barrel on the ICE Exchange. January Brent last traded at US$88.31/barrel.
BP (LON:BP) lost 1.3%, while fellow supermajor Shell (LON:RDSB) declined marginally, as did Cairn Energy (LON:CNE).
BG Group (LON:BG) held steady, while Tullow Oil (LON:TLW) outperformed fellow blue chips, climbing 1.3%.
Amec (LON:AMEC) rose marginally, while fellow oil and gas engineering firm Petrofac (LON:PFC) was sitting just below the opening level.
Soco international (LON:SIA) and Heritage Oil (LON:HOIL) led the midcaps, advancing 5% and 3.5% respectively. JKX Oil & Gas (LON:JKX) tacked on 1.9%, while Salamander Energy (LON:SMDR) posted a small gain.
Dragon Oil (LON:DGO) moved in the opposite direction, shedding 1.4%. Melrose Resources (LON:MRS) posted a small loss.
Premier Oil (LON:PMO) was little moved.
East and Central Africa focused oil and gas explorer Dominion Petroleum (LON:DPL) was among the top risers in the sector, surging 17.5%. Africa and FSU operating oil and gas exploration and production company Victoria Oil & Gas (LON:VOG) followed with an 11% gain.
EU operating producer and explorer Europa Oil & Gas (LON:EOG) and US focused Nighthawk Energy (LON:HAWK) followed, rising 8.5% and 7% respectively.