Oil prices sagged on Wednesday as the International Energy Agency said world demand growth was weakening and the U.S. government showed crude stocks rising to the highest level in six years. U.S. crude prices shed $1.22 to $50.80 a barrel, while London's Brent crude oil dropped $1.03 to $50.40 a barrel, Reuters said. Prices fell as the International Energy Agency's monthly Oil Market Report said higher fuel costs and weakening economic growth slowed demand growth in China, Europe and the United States during the first quarter this year. China's demand, an explosive 19.3 percent in the first quarter last year, slowed to 4.5 percent in the same period of 2005. The slowdown in growth means the outlook for fourth quarter world demand does not appear as likely to stretch producer countries as in the same period last year, the IEA said. Typically, fuel demand in the fourth quarter hits an annual peak as consumers in the northern hemisphere build winter stocks. The U.S. Energy Information Administration (EIA) on Tuesday lowered its estimate of U.S. oil demand in the second quarter by 80,000 bpd to 20.59 million bpd but said crude oil prices could stay above $50 in both 2005 and 2006. --More 2135 Local Time 1835 GMT
