Oil futures plunged to a three-month low on Wednesday (27 July), after US data pointing to a less than expected decline in crude inventories, added to persistent oversupply fears in the wider market.
At 2:24pm BST, the Brent front month futures contract was down 0.71% or 32 cents to $44.55 per barrel, while the West Texas Intermediate was down 0.10% or six cents to $42.89 per barrel.
Weekly industry data from the American Petroleum Institute (API) published late on Tuesday(26 July) indicated that US crude stocks fell by 827,000 barrels in the week to 22 July, well short of the 2.3 million barrel draw forecast by the market.
Analysts at Morgan Stanley noted that more attention needed to be paid to the 'forgotten' barrels.
"Most oil market participants spend a large amount of time analysing supply from the US and the Middle East. However, around 55% of the world's oil supply comes from other countries. Eventually, we see strong declines across the board.
"However, this decline is uneven, both across time and across countries. Oil markets appear weak until mid-2017 in our opinion, but should tighten rapidly thereafter," they wrote in a note to clients.
Meanwhile, precious metals enjoyed a sparkling afternoon of European trading, as the market priced in a weakening of the US dollar with the Federal Reserve poised to hold fire on interest rates.
At 2:24pm BST, the Comex gold futures contract for December delivery was up 0.46% or $6.10 to $1,326.90 an ounce, while Comex silver was up 1.94% or 38 cents to $20.07 an ounce. Spot platinum also rose 2.40% or $26.26 to $1,120.26 an ounce.
FXTM research analyst Lukman Otunuga said: "Although US rates may be left unchanged, market participants could seize this opportunity to focus on the tone of the statement while discovering additional clues which could provide clarity on when the Fed may act.
"Sentiment is still bullish towards the dollar and the pattern of positive US economic data in July continues to provide a compelling reason for the central bank to take action before year end. This means gold remains embroiled in a tug of war with the dollar."