LONDON: rent crude oil slipped towards $85 a barrel on Monday as the dollar strengthened and Chinese data pointed to slower economic growth as well as weaker fuel demand in the world's biggest energy market.
Although growth in China's vast factory sector rose to a three-month high in October as smaller firms saw more orders, according to a private survey, overall numbers pointed to a sluggish economy that is losing momentum.
The US dollar touched seven-year peaks versus the yen on Monday, dragging on oil prices as a strong greenback makes the commodity more expensive for buyers holding other currencies.
Brent crude for December delivery was down 40 cents at $85.46 a barrel by 0900 GMT.
The oil benchmark fell more than 9 percent in October, hitting its lowest in almost four years at $82.60 on Oct. 16.
US crude fell 30 cents to $80.24 per barrel after losing more than 11 percent last month. "Disappointing data will result in downscaling of oil demand expectations, and the dollar is stronger against the euro," said Hans van Cleef, senior energy economist at ABN Amro Bank in Amsterdam.
The final HSBC/Markit Manufacturing Purchasing Managers' Index (PMI) for China edged up to 50.4 in October from September's 50.2.
While the headline number looked slightly better, growth rates slowed in several key areas heading into the fourth quarter, putting the Chinese government's full-year growth target of 7.5 percent further in doubt.
A survey by China's National Bureau of Statistic (NBS) on Saturday showed factory activity fell to a five-month low last month as firms struggled with slowing orders and rising borrowing costs.
The official PMI from the NBS eased to 50.8 in October from September's 51.1, but was above the 50-point level that separates growth from contraction on a monthly basis.
As investors grappled with brittle growth in China, oil supply from the Organization of the Petroleum Exporting Countries (OPEC) in 2015 was expected to be similar to this year, OPEC officials have said, adding to signs the group is in no hurry to cut output.
Iraq managed to restore oil exports from its southern Basra terminals to 2.4 million barrels per day (bpd) on Sunday after bad weather had reduced its exports to 1.44 million bpd, a shipping source said.
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