Oil price is down 4.5% for the week
Decline on NYMEX is due to rising supplies, other factors; Futures are nearly $10 below April peak
After falling as low as $47.75 during yesterday's session, light sweet crude for June delivery settled 13 cents higher at $48.67 a barrel on the New York Mercantile Exchange.
Crude oil futures are now almost $10 below last month's peak, and brokers said prices could slip further in the weeks ahead if speculators bail out of the market.
They warned that if prices drop too sharply, perhaps to below $45 a barrel, the Organization of Petroleum Exporting Countries might begin to consider a production cut.
Saudi Arabia's oil minister Ali Al-Naimi is scheduled to speak in Washington Tuesday about global supply and demand.
"The one dark cloud on the horizon is the possibility that OPEC cuts production during the driving season," said Rick Mueller, an analyst with Energy Security Analysis Inc. in Wakefield, Mass. "In December, they took action because of falling prices and we saw records this year."
Oil prices are $2.29 lower than a week ago after sharp declines Wednesday and Thursday, and the stock prices of major oil producers and refiners are well off their highs.
"It does seem that demand is not as robust as previously thought," said Andrew Lebow, senior vice president at Man Financial Inc. in New York.
"You are seeing some short-covering because we have come off so far," said Edward A. Silliere, vice president of risk management at Energy Merchant Intermarket Futures LLC in New York. "I still think that next week we are going down to $45; the downtrend is intact."
"Short" refers to the sale of futures contracts or other securities in the hope of buying them back later at a lower price.
The commercial supply of crude oil in the United States is at its highest level since March 2002 and, from a technical trading standpoint, all charts indicate that prices are headed even lower in the near-term.
However, Lebow said, "It's way too soon to say that the market has turned from a long-term bull to a long-term bear."
Analysts said slumping sales of sport utility vehicles indicate that consumers are becoming sensitive to the high price of motor fuel, though they concede that the impact on daily gasoline demand will be marginal in the short-term.
After the slide in oil prices, retail gasoline prices are 9 cents below last month's peak, averaging $2.19 a gallon nationwide.
NYMEX gasoline futures dropped 1.98 cent to $1.4122 per gallon yesterday. Heating oil futures declined by less than a penny to $1.3703 per gallon.
On London's International Petroleum Exchange, June Brent crude futures rose 32 cents to $48.66 per barrel.
OPEC, which pumps 40 percent of the world's oil, increased production 0.9 percent in April to 30.07 million barrels a day compared with a month earlier, according to a Bloomberg survey.
That was the most oil that OPEC members have pumped since October when the group produced 30.54 million barrels a day.
The Associated Press and Bloomberg News contributed to this article.