Crude oil prices slightly declined and hovered below $93 a barrel in Asian trading Monday as traders booked profits after last week’s rally.
Light sweet crude for February delivery declined 0.34 percent or 32 cents to $92.77 a barrel in electronic trading on the New York Mercantile Exchange during the Asian trading hours. Brent crude oil futures for the February delivery fell 0.11 percent or 12 cents to $111.18 a barrel on the ICE futures exchange in London.
Oil futures surged 2.5 percent last week, the biggest weekly gain in almost four months, after the U.S. lawmakers approved the tax bill that will see a hike in income tax rates only on the wealthiest adults and stops the world’s biggest economy from falling back into a recession.
Encouraging economic reports from the U.S. and China also supported the crude oil prices. Data released last week showed that the U.S. labor market managed to hold steady despite budget concerns and factory activity recovered from a contraction in December.
The Department of Labor Friday reported that 150,000 jobs were added in December, in line with economists' estimate of 150,000 and slightly below the level for November. The unemployment rate was unchanged at 7.8 percent after the November figure was revised from a previously reported 7.7 percent.
The data released by the China Federation of Logistics & Purchasing showed that Chinese manufacturing activity expanded for the third straight month in December while the non-manufacturing activity also improved during the previous month, indicating some stabilization in the global recovery trend, particularly in the world’s largest- and second-largest oil consuming nations.
“Oil finished very strong last week and so far today there’s not been much movement. The markets primarily reacted to the U.S. jobs data. I wouldn’t be surprised if we saw some pullback,” Victor Shum, the managing director at IHS Consulting in Singapore, told Bloomberg.
On Friday, the light sweet crude for the February delivery rose 0.2 percent or 17 cents and settled at $93.09 a barrel on the New York Mercantile Exchange while Brent crude for the February delivery slipped 83 cents and settled at $111.31 a barrel.