Prices dampened by improved inventory

Oil prices hit a six-week low on Wednesday as the markets waited for weekly crude oil inventory figures from the United States, which is expected to show further rises in stockpiles of crude oil.

Another factor in the drop in oil prices seems to be a recent downward revision in the International Energy Agency’s estimate of global oil demand in 2005.

The IEA revised it’s estimates of demand, which have not been especially accurate the past two years, down by 50,000 barrels a day based on a number of factors, including its perception that crude oil demand in China is lessening.

This perception is not universally held, as OPEC has said that China’s oil demand in March was strong and continues to be strong in April.

In London, IPE Brent prices for a barrel of oil fell a further 42 cents to $51.56 for May delivery after it had lost $1.23 on Tuesday.

Brent’s price per barrel for June’s contract fell to $52.52. Nymax WTI’s price on May delivery crude oil also fell, with a loss of 42 cents to $51.44 per barrel. Nymax’s prices had seen a drop of $1.85 on Tuesday.