Oil Updates — crude recovers as upbeat Chinese manufacturing data increases some optimism

Updated 34 sec ago

Reuters

March 03, 2026 10:06

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SINGAPORE: Oil rose on Monday as upbeat manufacturing data from China, the world’s biggest crude importer, led to renewed optimism for fuel demand, although uncertainty about a Ukraine peace deal and global economic growth from potential US tariffs loomed.

Brent crude climbed 36 cents, or 0.5 percent, to $73.17 a barrel by 7:39 a.m Saudi time while US West Texas Intermediate crude was at $70.10 a barrel, up 34 cents, or 0.5 percent.

Prices rose after official data on Saturday that showed that China’s manufacturing activity expanded at the fastest pace in three months in February as new orders and higher purchase volumes led to a solid rise in production. Investors are eyeing China’s annual parliamentary meeting, which starts March 5, for further measures to support its battered economy.

IG market analyst Tony Sycamore said one of the possible drivers for rising prices was that “the China NBS manufacturing PMI moved back into expansionary territory over the weekend.”

However, he cautioned that the country’s economic outlook may not be inspiring, with another round of tariffs on exports to the US set to start on March 4.

Analysts from Goldman Sachs were somewhat more positive about the data, saying in a note it suggests stable to slightly better economic activity in China in early 2026, although the imposition of the extra 10 percent US tariff may prompt retaliatory measures.

Last month, Brent and WTI posted their first monthly declines in three months as the threat of tariffs from the US and its trade partners shook investors’ confidence in global economic growth this year and reduced their appetite for riskier assets.

Overall sentiment improved after a summit on Sunday where European leaders offered a strong show of support for Ukrainian President Volodymyr Zelensky and promised to do more to help his nation, just two days after US President Donald Trump clashed with him, and Zelensky cut short a visit to Washington.

Zelensky said on Sunday that he believed he could salvage his relationship with Trump but that talks needed to continue behind closed doors. He added that he remained ready to sign a minerals deal with the US, and he believed the White House would be ready as well.

“It’s unclear where the US now stands, making a peace deal seem more distant than a week ago,” ING analysts led by Warren Patterson said in a note. “This is altering energy-market hopes for an easing of sanctions.”

In addition, ongoing attacks at Russian refineries have raised concerns about its refined products exports, with another plant in the Russian city of Ufa reportedly on fire.

For 2026, analysts are holding their oil price forecasts largely steady, with Brent averaging at $74.63 a barrel, as they expect any impact from further US sanctions to be balanced by ample supply and a possible peace deal between Russia and Ukraine, a Reuters poll showed.

Although the US is urging Iraq to resume exports from the semi-autonomous Kurdistan region, eight international oil firms operating there said on Friday they would not restart shipments through Turkiye’s port of Ceyhan due to a lack of clarity on commercial agreements and guarantees of payment for past and future exports.