Oil prices advance on China data

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IOL image oil rig generic FREE IMAGES An oil rig is shown in this file photo.

Global crude prices rose Friday after a key survey showed Chinese manufacturing hitting a 14-month high in December, indicating a rebound in the world's second-biggest economy.

Brent North Sea crude for January gained 59 cents to $108.50 per barrel in midday deals in London.

New York's main contract, light sweet crude for delivery in January, or West Texas Intermediate (WTI), won 81 cents to $86.70 a barrel.

Crude prices were bolstered by preliminary figures from HSBC showing China's manufacturing expanding again in December, said Victor Shum, managing director at IHS Purvin and Gertz in Singapore.

“The oil market is reacting positively to the China HSBC Manufacturing PMI (Purchasing Manager's Index) showing expansion in factory activities,” he told AFP.

HSBC's PMI clocked China's manufacturing activity at 50.9 in December, a shade above market expectations of 50.8. A number above 50 indicates an expansion.

This is the second straight month that China's manufacturing has expanded after 12 consecutive months of contraction, and provides the latest indication that the giant economy is rebounding from a slowdown.

Beijing's National Bureau of Statistics on Sunday also released data showing production at China's factories, workshops and mines rising 10.1 percent in November compared with the same month last year.

The result was better than October's gain of 9.6 percent.

China's economic growth hit a more than three-year low of 7.4

percent in the three months to September, but recent data have fuelled optimism that the worst is over. - Sapa-AFP

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