The price of a barrel of Brent crude oil jumped 1.1 per cent to $53.94 in late afternoon trading after a report showed a surprise dip in US oil reserves.
A report by the US Energy Information Administration showed oil stocks fell to 459.7m barrels in the week to Friday, down 4.2m barrels from the week before.
The news sent Brent crude, which had been edging closer to the $50 mark all week, higher.
Meanwhile, West Texas Intermediate (WTI), the US benchmark, rose 1.9 per cent to $48.89 per barrel, its highest since last week.
The sudden jump in prices may have come too late to influence the Federal Reserve, which it's hoped will hint at plans for an interest rate hike in September later today.
However, IG's Josh Mahony suggested the record low prices may keep the Fed dovish.
"With inflation expected to fall further thanks to the recent deterioration in oil prices, a September hike seems unlikely," he said.
"The current disinflationary environment and [Fed chief] Janet Yellen's latest focus on consumer behaviour adds to the impression that September will not see any change in policy, given the drop in retail sales and consumer confidence this month."