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Concerns about Chinese manufacturing, European debt halt a four-day rise in oil
NEW YORK (AP) ' A four-day rise in oil prices stalled Wednesday following a weak report on Chinese manufacturing and lingering concerns about Greece's bailout.
The price of West Texas Intermediate, the benchmark for oils produced in the U.S., fell 46 cents to $105.79 a barrel.
WTI had climbed 5 percent over the last four trading days as tensions escalated between the West and Iran, the world's third-biggest oil exporter. The West is worried that Iran is using its nuclear program to build a weapon, a claim that Iran denies. Traders fear that any military action to stop the program could disrupt oil shipments. That helped push prices up in recent days.
But oil's rise paused as traders focused on a report that China's manufacturing isn't expanding. HSBC's China manufacturing index rose in February, but the reading of 49.7 suggested that factory activity isn't growing. China's economy is expected to drive world oil demand to new heights this year, and investors took the weak reading as a sign that demand may not increase as much as expected.
Traders also worried that the latest Greek bailout isn't enough to revive that nation's economy. Analysts said a $172 billion rescue package may not be enough to save the country from defaulting on a mountain of debt. Massive budget cuts could keep the country stuck in recession, and the Greek bailout doesn't address debt problems in neighboring countries.
U.S., retail gasoline prices rose nearly a penny to a national average of $3.58 per gallon, according to AAA, Wright Express and Oil Price Information Service. Gasoline is at the highest price ever for this time of year, and analysts say the national average could hit $4.25 per gallon by late April.
In other energy trading, heating oil rose a penny to $3.25 per gallon. Gasoline futures also rose by 1 cent to $3.0603 per gallon. Natural gas futures fell by 4 cents to $2.59 per 1,000 cubic feet.
Brent crude, an international benchmark used to price oil imported by U.S. refineries, rose $1 to $122.66 per barrel.