Oil prices gained more than two percent on Tuesday following the ZEW index for Europe's revelations of an increase, despite China's GDP rate which turned out to be below the government's target and which did not have long term effects on prices.
China's annual GDP growth rate for 2014 was announced as 7.4 percent earlier Tuesday, still below what the government targeted but significantly above expectations.
The Chinese government had 7.5 percent as its target and analysts expected that figure to be around 7.2 percent.
After the announcement, the price of the global benchmark Brent crude oil decreased slightly to reach $48.30 per barrel at 10:45 a.m. GMT, from $48.84 per barrel at 8:00 a.m. GMT, according to official figures.
The 2014 GDP rate is the lowest since 1990, when it saw 3.8 percent, and far away from the double digit growth rates between 2003 and 2007, according to World Bank data.
For the world's biggest energy consumer, the low rates of growth do not only hamper the country's demand for oil, but also bring down global oil demand as well.
Oil prices have declined sharply since June, falling almost 60 percent, and marking their fastest dive since 2008, due to low oil demand and slower growth rate in Asian and European economies.
- ZEW indicator
Meanwhile, the increase in the ZEW index has also created a positive sentiment in the markets, while Brent prices rose to $49.40 per barrel at 1:20 p.m. GMT, from $48.33 per barrel at 11:15 a.m.
The ZEW index indicates the balance between positive and negative expectations on economic development for the future regarding Germany and Europe.
The ZEW Indicator of Economic Sentiment for Germany is at 48.4 points as it rose for the third consecutive time since February 2014, according to its website.
While the positive outlook by the ZEW indicator increased oil prices, low prices also paved the way for ZEW to gain value.
'Decreasing crude oil prices and a depreciating euro have contributed to a further gain of the indicator,' said ZEW President Professor Clemens Fuest.
With the positive improvement of Germany's ZEW index, the backbone of the European economy, ZEW’s Indicator of Economic Sentiment for the Eurozone has also increased to 45.2 points, giving a positive sentiment for the European markets overall.
By Ovunc Kutlu
Anadolu Agency
ovunc.kutlu@aa.com.tr