Oil prices drift lower

LONDON: Oil prices fell on Friday in muted trading with public holidays in much of Europe.

Brent North Sea crude for delivery in June dropped 32 cents to 50.48 dollars a barrel in London trade.

New York's main contract, light sweet crude for June, lost 24 cents to 50.88 dollars per barrel.

This week, the oil market was rattled by growing fears that the deadly swine flu outbreak could hinder a global economic recovery -- and further weaken demand for crude.

But traders also digested data which raised hopes of an end to the global economic downturn.

"Crude oil is currently trading just under the 51 dollars per barrel mark after (rising) in April on signs that the global economy and fuel demand will recover this year," said BetOnMarkets analyst Dave Evans.

"Industrial output in Japan increased for the first time in six months while UK consumer confidence climbed to the highest level in a year. Traders are hoping that this is the start of a rebounding economy."

However, world oil prices have slumped since striking record highs above 147 dollars per barrel in July 2008, as energy demand has tumbled in the downturn.

Some analysts warn the swine flu outbreak will further weaken demand for air travel and oil. Jet fuel, or kerosene, is refined from crude.

"Despite swine flu hysteria sweeping the globe, concerns of a pandemic have so far only marginally affected oil prices," cautioned analysts at the JBC Energy consultancy in Vienna.

"The only product for which deterioration has been observable is jet fuel," they added.

The World Health Organization (WHO) has warned that a global pandemic may be imminent. Its latest data on Friday showed 331 confirmed cases of infection in 11 countries. The only fatality outside Mexico is in the United States.