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 The initial reaction on oil markets was largely muted after data on
Monday showed the Chinese economy eased to 7.7 percent between
October and December, from 7.8 percent in the previous three months
and slightly ahead of market expectations for growth of 7.6 percent.
"I would think the data is supportive of oil prices. I am certainly
expecting somewhat of a relief rally in risk asset over the next 24
hours," said Ben Le Brun, a market analyst at OptionsXpress in
Sydney.
"The data is a cause for relief, as it eases some of the fears over
the Chinese economy," he said.
Brent crude for March delivery was down 18 cents at $106.30 per
barrel at 0314 GMT, after closing up 73 cents on Friday.
U.S. crude for February delivery was trading 67 cents lower at
$93.70 per barrel, after settling up 41 cents at a two-week high on
Friday. Floor trading will be closed on Monday and there will be no
settlement on the New York Mercantile Exchange due to the Martin
Luther King, Jr. Day holiday.
"The stronger dollar looks like it had quite a big impact in the
Asian session. I think that's at least part of the reason we're
seeing prices lower," said Le Brun.
The dollar index, a gauge of the dollar's value versus six major
currencies, was a tad lower on Monday at 81.194, but still close to
its highest level in nearly 10 weeks reached on Friday .
In other data, China's industrial output grew 9.7 percent in
December from a year ago, compared to expectations of 9.8 percent in
the Reuters poll.
A slowdown in China's growth has raised fears of a hard landing for
the economy. China has been the main driver for global oil demand in
the past decade, and the country last year overtook the United
States as the world's biggest oil importer.
LIBYAN OIL PORTS
Brent could come under pressure this week on expectations of
increased supply from The Middle East and North Africa.
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In Libya, the government said it plans to remove protesters who have
seized eastern ports used for oil exports within the next few days.
The three ports, which together accounted for 600,000 barrels per
day of exports, have been occupied by heavily-armed rebels since the
summer.
World powers and Iran are due to start implementing a landmark deal
on Monday to curb Tehran's nuclear programme, which could suspend
some economic sanctions against the country and bring more oil
supply to global markets.
The mutual concessions are scheduled to last six months, during
which time the parties aim to negotiate a final accord defining the
permissible scope of Iran's nuclear activity.
Sanctions have cut Iran's oil exports by more than half over the
past 18 months to about 1 million barrels per day (bpd). Tehran has
said it will take six months after sanctions are lifted to return to
full oil output capacity of 4 million bpd.
In other news, top oil exporter Saudi Arabia welcomes the surge in
U.S. shale oil production for its stabilizing effect on crude
prices, Saudi oil minister Ali al-Naimi said Sunday.
The Organization of the Petroleum Exporting Countries (OPEC) said at
the end of last year that the group faced a shrivelling market share
over the next five years, with the shale energy boom set to boost
rival supplies.
(Reporting by Jacob Gronholt-Pedersen;
editing by Michael Perry)
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