Crude slipped below $50 per barrel this afternoon following lacklustre US oil data, with investor calm ahead of the EU referendum failing to provide enough support.
Brent crude, the global benchmark, slipped 1.50 per cent to $49.86 per barrel, while West Texas Intermediate crude, the US benchmark, fell 1.48 per cent to $49.11.
The Energy Information Administration said US oil stocks fell to 900,000 in the week ending 17 June, below the 1.7m drawdown expected by analysts, and much less than the 5.2m drop reported yesterday by the American Petroleum Institute.
"Today's report is decidedly bearish, which has caught markets off guard after yesterday's API expectation of a 5m barrel crude draw," Troy Vincent, analyst at New York-based crude cargo tracker ClipperData, said.
But prices have still risen sharply this week, after they fell to a one-month low on Thursday, following six consecutive days of losses. This was driven by growing fears over the UK voting to leave the EU in tomorrow's vote.
However, a series of polls over the past few days suggesting an increasing lead for the Remain side have quelled fears – yesterday's Survation poll suggested 50.7 per cent support for Remain, compared with 49.3 per cent.
"Though some may be forgiven for thinking that the outcome is a foregone conclusion, the inconsistency between the betting money and the polls mean that conditions are ripe for a fresh bout of volatility," said Stephen Brennock of oil broker PVM.