NEW YORK (CNN/Money) -
Oil prices settled below $52 Wednesday after a government report showed that crude inventories rose last week while gasoline stocks fell less than expected.
U.S. light crude for June delivery fell $2.59 a barrel to end the day at $51.61 on the New York Mercantile Exchange. In London, the June Brent contract lost $1.84 to settle at $52.30.
The active gasoline futures contract tumbled 8.71 cents to end the session at $1.5380 a gallon on the NYMEX.
A combination of several factors including a recent rise in oil prices, a slow season for oil demand and the day's inventories report all pressured crude prices, said Fadel Gheit, an oil analyst at Oppenheimer.
The Energy Information Administration said crude oil inventories rose by 5.5 million barrels in the week ended April 22, far higher than the 650,000 rise forecast by analysts surveyed by Briefing.com.
Crude oil imports averaged nearly 10.9 million barrels per day last week, the third highest weekly average ever, the EIA said.
Over the last four weeks, crude oil imports have averaged nearly 10.1 million barrels per day, 19,000 barrels per day more than over the comparable four weeks last year, the EIA said.
"Also, the president is making speeches trying to talk oil prices down and say the situation is better, but talk won't change the underlying fundamentals," said Gheit. "Demand is still strong, supply is still tight. So even if perception changes for a bit, the situation is no different."
Against a backdrop of high gas prices and the approaching summer driving season, President Bush will give his second energy speech in a week, unveiling new initiatives aimed at helping address the nation's energy needs.
Crude prices had traded in a narrow range prior to the EIA report, down about 40 cents, before the release triggered a wave of selling.
"I think they overreacted on the downside," said an analyst at Alaron Trading. "Our critical support level was at $52.90 and the price went down (below that) level.
"We'll see some buying on the dips," he added.
At 324.4 million barrels, crude oil inventories are above the upper end of the average range for this time of year, the EIA said.
Moreover, closely watched gasoline stocks fell by 300,000 barrels, less than the expected dip of 1 million barrels. The EIA said this puts gasoline supplies at the upper end of the average range for this time of year.
Despite a decrease in refinery input, gasoline production also rose significantly last week, averaging nearly 8.9 million barrels per day from 8.6 million in the previous week, the EIA said.
Distillate fuel stocks fell 1.4 million barrels, the EIA said. Briefing.com had forecast a 100,000 barrel rise in distillate inventories.
Click here for CNN/Money's special report -- "Oil Crunch 2005."