Oil prices edged up on Monday after Chinaโs factories unexpectedly ramped up production in September, easing concerns about demand at the worldโs largest crude importer amid an ongoing trade war with the United States.
Brent crudeย futures rose 9 cents to $62 a barrel by 0300 GMT while US West Texas Intermediate (WTI) crude futures rose 13 cents to $56.04 a barrel.
The Caixin/Markit Manufacturing Purchasing Managersโ Index (PMI) for September expanded for a second straight month as Chinese factories ramped up production and new orders rose, beating market expectations.
โThe Caixin data was a real surprise and should be positive for Asiaโs markets today,โ said Jeffrey Halley, OANDA senior analyst in Singapore.
He added that the data would need to post similar results over the next few months to point to a China oil demand growth recovery. The country is the worldโs second largest oil user.
Brent is set to rise 2.6% in September, its first monthly gain since June, with prices lifted by an unprecedented attack on Saudiโs oil facilities on September 14 that reduced its production by half. WTI is set to rise 1.7% this month. .
Worldโs top oil exporter Saudi Arabia has restored capacity to 11.3 million barrels per day, sources told Reuters last week although Saudi Aramco has yet to confirm it is fully back online.
โMost of this is already priced in when the Saudis said they were going to do it (resume production) fast,โ said Avtar Sandu, a senior commodities manager at Phillip Futures in Singapore.
While Saudi Arabia is maintaining exports by using crude from inventories and spare production capacity, how much of it is actually restored could only be determined in the next few weeks, he added.
Still, geopolitical tensions in the Middle East simmered after Saudi Arabiaโs crown prince warned in an interview broadcast on Sunday that oil prices could spike to โunimaginably high numbersโ if the world does not come together to deter Iran, but said he would prefer a political solution to a military one.
This came a day after Yemenโs Houthi movement said it had carried out a major attack near the border with the southern Saudi region of Najran and captured many troops and vehicles, but there was no immediate confirmation from Saudi Arabian authorities.