Global oil prices rose to the highest level in nearly two weeks after better-than-expected economic data from China boosted demand speculation amid signs that the pace of U.S. production may be slowing.
West Texas Intermediate crude futures for August delivery were marked 0.34% higher from their Friday close at $46.70 in the opening hours of European trading while Brent contracts for September, the global benchmark, were seen 0.25% higher at $49.03 per barrel.
China's GDP grew at a slightly faster-than-expected pace in the second quarter, according to official data published Monday, as surging industrial production and solid exports kept the world's second-largest economy humming in the face of significant concerns for its financial sector.
China's economy, the world's biggest consumer of energy, expanded at an annual 6.9% clip in the three months ending in June, the National Statistics Bureaus said, a rate that was modestly faster than the 6.8% pace anticipated by analysts but largely in line with the rate of growth over the first quarter. Industrial output, which rose 7.6% from the same period last year, paced the GDP gains, while an 11% surge in retail sales underscored the strength of the domestic consumer economy.
The data followed figures from Houston-based oil services group Baker Hughes Friday which showed U.S. drillers added two new rigs to their production lines last week, bringing the total to 765, the highest since August 2015. However, the slower pace of additions, as well as a much larger-than-expected decline in U.S. crude stocks reported by the Energy Information Administration last week of 7.6 million barrels, suggests the torrid pace of American production could be easing.