Black Gold Rises on China and U.S. Manufacturing Data

Oil rose in London, heading for a weekly gain as a report signaled manufacturing may expand at a faster pace this month in China, the world’s second-largest crude consumer.

“Futures advanced as much as 1 percent and headed for the first weekly increase in three. A preliminary purchasing managers’ index for China by HSBC Holdings Plc and Markit Economics showed a reading of 50.9, higher than a median estimate of 50.8 in a Bloomberg News survey. A figure above 50 indicates an expansion. U.S. industrial production probably climbed 0.3 percent in November, according to a separate Bloomberg survey before Federal Reserve data today.

“China has been showing decent economic progress lately and so has the U.S.,” said Andrey Kryuchenkov, an analyst at VTB Capital in London who predicts Brent crude will trade from $104 to $114 a barrel this month. “The market is comfortable with supplies, and this will keep volatility down next year.”

Brent for January settlement, which expires today, advanced as much as $1.09 to $109 a barrel on the London-based ICE Futures Europe exchange. It was at $108.88 at 12:42 p.m. London time. The more actively traded February contract gained 97 cents to $107.43. The European benchmark grade, up 1.7 percent this week, was at a premium of $22.14 to West Texas Intermediate, the U.S. marker.

WTI for January delivery rose as much as $1.03 to $86.92 a barrel in electronic trading on theNew York Mercantile Exchange. ”

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