SINGAPORE: Brent crude futures fell below $110 on Tuesday, after China's economy grew a shade below expectations in the third quarter, failing to dispel fears of slowing growth in the world's second largest oil consumer.
China's annual economic growth eased to 9.1 percent in the third quarter from 9.5 percent in the previous quarter, the National Bureau of Statistics said on Tuesday, as tight domestic monetary policy and easing foreign demand crimped activity.
The rate was slightly below market forecasts for growth of 9.2 percent.
"I wouldn't call it a downside surprise, the numbers still indicate a soft landing, but not enough to lift commodity prices in the current environment," said Ric Spooner, chief market analyst with CMC Markets in Sydney.
Brent crude for December traded 31 cents lower at $109.85 a barrel by 0222 GMT. US crude lost 30 cents to $86.08, one day before the front-month November contract expires.
Other Chinese economic data released on Tuesday were positive, with industrial output and retail sales growing faster than expected last month.
Brent lost 2 percent on Monday after Germany's finance minister said an upcoming European Union summit would not produce a quick fix to the euro zone debt crisis.
Wolfgang Schaeuble's comments continued to weigh on sentiment, sending Asian stocks and commodities lower on Tuesday.
"The downside will look toward technical resistance levels and the day-to-day ups and downs of the European debt situation," said MF Global analyst Tom Pawlicki in a research note.
Market participants now await Chinese inflation data this Friday for signs that the government may ease monetary policy next year, a move that could help to spur demand for oil.
Annual consumer price inflation may have slowed to 6.1 percent in September from 6.2 percent in August, still within striking distance of a three-year high of 6.5 percent seen in July, a Reuters poll showed.
China had said on Saturday that apparent oil consumption grew only 3.2 percent from a year earlier in the third quarter, down from the 5 percent rise in second quarter and 9.3 percent in the first quarter.
Brent could rise to $112.47 per barrel after breaking resistance at $109.92, while US crude is expected to trade between $84.10 and $86.26 for one session before either surging towards $89.76 or falling to $81.65, according to Reuters market analyst Wang Tao.
SUPPLY ISSUES:
Oil prices were supported by lower Angolan crude production expected in December.
Angola will export around 1.69 million barrels per day (bpd) of crude oil in December, trade sources said on Monday, down from 1.84 million bpd originally scheduled to load in November.
A Reuters poll ahead of weekly inventory reports forecast a 1.9 million barrel increase in US domestic crude stocks.
Distillate stocks were projected down 1.4 million barrels and gasoline supplies were seen down 900,000 barrels, while refinery utilization was likely off 0.2 percentage point, the poll showed.
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