By Scott DiSavino
NEW YORK (Reuters) - Oil prices were nearly 2% lower on Thursday after a leak on a key U.S. pipeline disrupted supply flows and on data showing weak factory activity in China.
The front-month Brent contract for December delivery expires on Thursday. Futures for January delivery
For the month, Brent was on track to fall less than 1% and WTI was on track to rise less than 1%.
In the United States, TC Energy Corp's
Marketlink is connected to the 590,000-bpd Keystone oil pipeline system, a key transporter of Canadian crude from northern Alberta to refineries in the U.S. Midwest.
Traders said the Marketlink disruption pressured U.S. crude prices lower by making it harder to move oil out of the Cushing storage hub, which is the delivery point for WTI crude contracts.
About 9,120 barrels of oil were estimated to have spilled from Keystone after a leak was discovered late Tuesday, according to state regulators in North Dakota.
In China, meanwhile, factory activity shrank for a sixth straight month in October while growth in the country's service sector activity was its slowest since February 2016, official data showed on Thursday.
A protracted trade war between China and the United States has been weighing on the demand outlook for oil.
Leaders from the United States and China encountered a new obstacle in their struggle to end the trade conflict when the summit at which they were supposed to meet was cancelled because of violent protests in Chile, the host nation.
U.S. President Donald Trump tweeted a new location would be announced soon.
A Reuters survey showed that oil prices are likely to remain pressured this year and next. The poll of 51 economists and analysts forecast Brent crude would average $64.16 a barrel in 2019 and $62.38 next year.
Releasing third-quarter results, Royal Dutch Shell Plc
The U.S. Federal Reserve cut interest rates for a third time this year on Wednesday, looking to bolster economic growth with a move that could also boost demand for crude.
Yet gains are likely to be capped until inventories start to show sustained declines.
U.S. crude inventories
"The U.S. stock report was anything but encouraging," PVM analysts said in a note.
Cushioning the bearish crude data, the EIA showed gasoline and distillate inventories continued to draw.
Graphic: U.S. petroleum inventories - https://fingfx.thomsonreuters.com/gfx/editorcharts/US-OIL-STOCKS/0H001PBQX5Y0/eikon.png
(Additional reporting by Shadia Nasralla in London and Aaron Sheldrick in Tokyo, Editing by Marguerita Choy and David Evans)
This story has not been edited by Firstpost staff and is generated by auto-feed.
Updated Date: Nov 01, 2019 00:07:01 IST