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 Both China's exports and crude imports fell, stoking concerns about
demand in the world's second-biggest economy. The trade data
coincided with news that OPEC lowered its 2014 forecast for oil
demand.
The Libyan government lifted a force majeure on the eastern port of
Hariga, which had been blockaded due to a dispute with rebel groups.
However, a force majeure remained in effect at Zueitina, the other
Libyan port the government recently reopened, making a full rebound
in exports uncertain.
Tensions between the West and Russia bubbled in the background as
Russian President Vladimir Putin threatened to cut off natural gas
supplies to Ukraine if it did not pay its bill.
U.S. crude oil was supported slightly by news that U.S. jobless
claims fell to their lowest level in 7 years.
But that was not enough to outweigh data released Wednesday that
showed U.S. crude oil stocks jumped by 4 million barrels last week.
"The market was knocked by the Chinese import export data — it was a
bearish double whammy," said Matt Smith, analyst at Schneider
Electric in Louisville, Kentucky. "But we're loath to move lower
given the dual concern of Moscow and Libya, where there is
uncertainty as to when control of those ports will transfer power."
Brent settled 52 cents lower at $107.46 a barrel. U.S. crude settled
20 cents down at $103.40 per barrel.
The closely watched and traded Brent-WTI spread <CL-LCO1=R>
tightened 32 to settle at $4.06, its narrowest settlement since
Sept. 19. Further losses in Brent were stemmed by optimism after the U.S.
Federal Reserve's dovish policy meeting suggested the central bank
may be more cautious toward raising interest rates, easing market
concerns of a pullback in stimulus before the economy is ready.
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In his most explicit threat to date, President Vladimir Putin warned
European leaders Russia would cut natural gas supplies to Ukraine,
which could lead to a reduction of onward deliveries to Europe.
The threat risks worsening a dispute with the West over Russia's
annexation of Crimea, and investors are watching to see whether it
results in stiffer economic sanctions on Moscow.
A steep fall in U.S. gasoline stockpiles also put a floor under oil
prices. Gasoline stocks fell by 5.2 million barrels to 210 million
barrels in the week ended April 4, Energy Information Administration
(EIA) data showed, more than the expected 729,000-barrel draw.
Demand for gasoline was 4.4 percent higher than a year ago at 8.8
million barrels per day.
(Additional reporting by Lin Noueihed; editing by David Evans, Dale
Hudson and Tom Brown)
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