The price of oil fell Tuesday, dented by soft Chinese manufacturing figures and Russia's withdrawal of a small number of troops from the forces massed along its border with Ukraine.
Benchmark U.S. crude for May delivery was down 29 cents to $101.29 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 9 cents to $101.58 on Monday as markets kept an eye on talks between the U.S. and Russia over the crisis in Ukraine.
Brent crude, used to set prices for international varieties of oil, fell 7 cents to $107.69 a barrel on the ICE exchange in London.
Ric Spooner of CMC Markets in Sydney said two Chinese manufacturing surveys released Tuesday showed "downside risks" to China's economy
The manufacturing index by the China Federation of Logistics & Purchasing ticked up to 50.3 in March from 50.2 in February. But economists said the increase should have been a lot stronger because factories typically return to full speed in March after shutting for the extended Lunar New Year holiday, which begins in either January or February each year.
The index uses a 100-point scale on which numbers above 50 indicate expansion.
China's economy has slowed after a decade of red-hot expansion as the country's leaders try to reduce reliance on trade and investment and encourage growth based on domestic spending.
Spooner said reports that Russia pulled out a battalion of troops from the Ukrainian border also "may induce a little bit of trader selling" on hopes the crisis is easing. But one must be wary of such short-term announcements, he said. Russia's annexation of Ukraine's Crimean peninsula, its troop buildup near Ukraine's border and its attempts to compel constitutional changes in Ukraine have raised tensions with the West and prompted fears that Moscow intends to invade other areas of its neighbor.
Oil prices have been supported by the possibility that economic sanctions against Russian officials and businessmen could expand to affect Russia's energy sector.
In other energy futures trading in New York:
- Wholesale gasoline fell 0.7 cent to $2.911 a gallon
- Natural gas was down 1 cent at $4.361 per 1,000 cubic feet.
- Heating oil eased 0.2 cent to $2.928 a gallon.