Oil prices traded lower on concerns over the global oil oversupply ahead of the OPEC's meeting. The OPEC will meet in Vienna on December 04 to decide on the oil output limit. Analysts expect the OPEC to keep its output limit unchanged.

Reuters reported today that OPEC source said the oil price could decline toward $35 a barrel if the Fed will raise its interest rate this month.

Today's Chinese economic data supported oil prices. The Chinese manufacturing PMI fell to 49.6 in November from 49.8 in October, according to the Chinese government. It was the lowest reading since August 2012. Analysts had expected the index to remain unchanged at 49.8. The services PMI rose to 53.6 in November from 53.1 in October.

The Chinese Markit/Caixin manufacturing PMI rose to 48.6 in November from 48.3 in October, beating expectations for a reading of 48.3.

Market participants are awaiting the release of U.S. crude oil inventories data. The American Petroleum Institute (API) is scheduled to release its U.S. oil inventories data later in the day, and U.S. oil inventories data from the U.S. Energy Information Administration is expected on Wednesday.

WTI crude oil for January delivery declined to $41.55 a barrel on the New York Mercantile Exchange.

Brent crude oil for January fell to $44.10 a barrel on ICE Futures Europe.

Gold traded mixed as market participants are cautious ahead the release of the U.S. labour market data on Friday. The better-than-expected U.S. labour market data will add to speculation that the Fed will start raising its interest rate this month.

Today's U.S. economic data supported gold price. The Institute for Supply Management released its manufacturing purchasing managers' index for the U.S. on Tuesday. The index declined to 48.6 in November from 50.1 in October, missing expectations for a rise to 50.4. It was the lowest level since November of 2012.

December futures for gold on the COMEX currently traded at 1065.20 dollars per ounce.

The Chinese Markit/Caixin manufacturing PMI rose to 48.6 in November from 48.3 in October, beating expectations for a reading of 48.3.

Overall new business declined modestly, while new export work climbed at fastest pace in over a year.

"Pressure on economic growth has eased and fiscal policy has had a strong effect. Overall, the economy is still on track to become more stable," Dr. He Fan, Chief Economist at Caixin Insight Group, said.

The Chinese manufacturing PMI fell to 49.6 in November from 49.8 in October, according to the Chinese government. It was the lowest reading since August 2012.

Analysts had expected the index to remain unchanged at 49.8.

A reading above the 50 mark indicates expansion, a reading below 50 indicates contraction.

The decline was driven by weak demand both at home and abroad for products from China.

The services PMI rose to 53.6 in November from 53.1 in October.

The International Monetary Fund (IMF) voted on Monday to add the yuan to its basket of reserve currencies. The addition will take effect October 1, 2016.

"The Executive Board's decision to include the RMB in the SDR basket is an important milestone in the integration of the Chinese economy into the global financial system. It is also a recognition of the progress that the Chinese authorities have made in the past years in reforming China's monetary and financial systems," the IMF Managing Director Christine Lagarde said on Monday.

The IMF's basket of reserve currencies (Special Drawing Rights SDR)) includes the yen, euro, pound, U.S. dollar and the yuan now. Weightings will be 41.73% for the U.S. dollar, 30.93% for the euro, 10.92% for the yuan, 8.33% for the yen and 8.09% for the British pound.

The SDR was modified in 2000 last time, when the euro replaced the German Deutsche Mark and the French franc.

West Texas Intermediate futures for January delivery advanced to $41.99 (+0.82%), while Brent crude is currently at $44.85 (+0.54%). Market participants are waiting for OPEC meeting scheduled for December 4. There is speculation that the group, led by Saudi Arabia, will amend its policy and decrease production in order to support prices. However many analysts still doubt that OPEC will take this step. The cartel is likely to defend its market share against competitors.

Traders are also waiting for the key U.S. employment report, which also expected to be released on Friday. These data would increase volatility of the dollar and affect the dollar-denominated crude.

Meanwhile demand in world's second-biggest consumer of oil China is unlikely to rise significantly as activity in the country's manufacturing sector remains sluggish. According to China Federation of Logistics and Purchasing the Manufacturing PMI fell to 49.6 in November from 49.8 reported previously. The latest reading is the lowest since August 2012.

Gold climbed to $1,071.50 (+0.58%) on short covering and as the dollar retreated from an eight-month high against a basket of major currencies. Investors have been preparing for a Federal Reserve's looming rate hike by selling gold.

Market participants are waiting for the U.S. jobs report due on Friday to assess probability of a rate hike when the Federal Reserve's Federal Open Market Committee meets on December 15-16. Higher rates would be harmful for the non-interest-paying bullion.

Meanwhile physical demand in top consumer China was strong. Premiums on the Shanghai Gold Exchange were at a healthy $5-$6 an ounce.

(raw materials / closing price /% change)

Oil 41.68 +0.07%

Gold 1,065.80 0.00%