LONDON—Oil futures were lower as disappointing economic data weighed on market sentiment.
Slowing manufacturing activity in the euro zone, U.K., U.S. and China renewed concerns over the prospects for global growth and painted a bleak picture for future oil demand.
Tuesday morning, the front-month September Brent contract on London's ICE futures exchange was 17 cents, or 0.2%, lower at $116.64 a barrel.
The front-month September contract on the New York Mercantile Exchange was trading down 54 cents, or 0.6%, at $94.35 per barrel.
Prices are likely to remain under pressure this week as investors continue to watch macroeconomic developments. Friday's report on U.S. employment will be watched particularly closely as an indication of the health of the economy in the world's largest oil consumer.
"The last few sets of numbers out of the U.S. have been appalling, surprising analysts to the downside. The markets are probably bracing themselves for another shocker," said Ole Hansen, manager of the futures and fixed-income trading desk at Saxo Bank.
However, the downside for Brent may be limited by continued production problems and a planned shutdown of the Forties pipeline system in the North Sea, operated by BP PLC, said Andrey Kryuchenkov, vice president of commodities research at VTB Capital.
Forties is the main component of the Brent blend, so supply disruptions have a significant impact on the price of the European benchmark.
Historically, the U.S. and European benchmarks have traded within just a few dollars of each other, but a bottleneck at Cushing, Okla., the delivery point for Nymex crude, West Texas Intermediate, has sent stocks of WTI soaring since the beginning of this year, sending the crude to a steepening discount to its European counterpart.
The price gap between Brent and WTI rose above $22.00, just shy of the $23.45 record reached in mid-July.
The ICE's gasoil contract for August delivery was down $1.75, or 0.2%, at $969.00 per metric ton, while Nymex gasoline for September delivery was 65 points, or 0.2%, lower at $3.0475 per gallon.
