[SINGAPORE] Oil markets opened to cautious trading in Asia on Tuesday ahead of data expected to show China's economy grew at the slowest pace in 24 years in 2014, stoking worries in energy markets already suffering from slowing demand and oversupply.
China is expected to report on Tuesday (0200 GMT) that economic growth slowed to 7.2 per cent in the fourth quarter, a Reuters poll showed, keeping pressure on policymakers to roll out more stimulus measures. "All eyes will be on the Chinese data today with any falls likely to exacerbate the supply driven weakness," ANZ bank said in a morning note.
Brent crude futures were trading at US$48.90 per barrel at 0115 GMT, close to their last settlement, while US crude was trading down US$1.09 at US$47.60 a barrel.
Recent price falls have steepened the price difference between oil for immediate delivery and for barrels for supply at a later stage, known as contango. "Producers globally are struggling to find buyers for their crude, which is reflected in the contangos in the Brent and WTI futures curves," Barclays said in a note.
Brent's contango between deliveries in March this year and a year later is currently around US$10 per barrel. "Refiners will run any crude that is economically and technically possible to make a margin while margins are attractive (although product stocks are piling up), and any additional crude will make its way into the most economic storage available, collecting time arbitrage as an incentive," the bank added.