After briefly reaching above the $100 mark on Monday morning for the first time in five sessions, Brent crude oil dipped again on Tuesday following disappointing Purchasing Managers data from China which confirmed worries about future supply growth.
The commodity traded at 99.75 at 5:35 GMT on Tuesday morning.
Brent's sagging price has caused problems for some of OPEC's members whose budget breakeven point is $100 per barrel. The organization has a scheduled meeting for May 31, at which some are expecting talk of tightening up supply to keep prices above $100.
Reuters reported that Chinese PMI fell from 51.6 in March to 50.5 as the nation's exports shrank. The data confirmed investors' fear that the oil consuming giant's recovery wasn't as strong as they were hoping.
While the data disappointed, some say there is a silver lining in that the figure is above 50, which indicates growth rather than contraction.
Geopolitical tension has lent some support to the commodity as fighting and oil theft in Nigeria forced Royal Dutch Shell to close a 150,000 barrel per day pipeline in Nembe last week.
But the problems in Nigeria could be countered by supply increases in other parts of Africa as South Sudan's oil production is expected to resume next week after being closed since January 2012 due to a dispute with Sudan regarding oil fees.
Crude supply from Syria could also increase this week after the EU agreed to ease the oil embargo in Syria in an effort to help opponents of Syrian President Bashar al-Assad. Although crude transactions with the nation will be complicated, EU leaders want to help regions controlled by the opposition develop economically.
(c) 2013 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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