Oil markets shrugged off an attempted coup in Turkey late last week after a vital global shipping route was re-opened.
Brent crude, the global benchmark, fell 1.85 per cent to $46.73 per barrel this afternoon. Meanwhile, the US benchmark, West Texas Intermediate crude, slumped 1.78 per cent to $45.13.
"The market is looking past the coup," CMC Markets' chief analyst, Ric Spooner, said. The black stuff had rallied in late trading on Friday after armed forces said they'd taken power in Turkey.
The country re-opened its Bosphorus Strait, one of the world's most important oil choke points, on Saturday. The 17-mile waterway, which handles three per cent of global shipments, had been shut off by the military.
Turkish president Recep Tayyip Erdogan arrested more than 6,000 soldiers over the weekend - including senior military leaders and judges - as he vowed to purge state institutions of the virus that caused the unrest.
Meanwhile, investment bank Morgan Stanley raised concerns about the longer-term outlook for oil consumption. They said demand for petrochemicals, rather than fuels such as diesel of gasoline, is clouding the outlook for crude demand.
Read more: A history of Turkey's coups
"Fundamental headwinds are growing, supply-demand rebalancing is likely still a mid-2017 event, but tail risks are admittedly large in both directions, as geopolitics add to uncertainty," the report said.
"A rapid rise of non-petroleum products is boosting total product demand, but this is unhelpful for crude oil. Based on the latest data, ever our tepid 800,000 barrels per day growth estimate for global crude runs looks too high."