London - Oil halted gains near $49 a barrel as markets awaited weekly US stockpile data, while the UK referendum on membership of the European Union remained too close to call.
Futures slid as much as 1% in New York. US inventories probably fell by 1.5 million barrels last week, keeping them more than 100 million barrels above the five-year average, according to a Bloomberg survey before government data on Wednesday.
Separate polls showed leads for either side of the UK referendum before the vote on Thursday.
Oil has advanced more than 85% from the lowest level in 12 years as disruptions from Nigeria to Canada and falling output in the US trimmed a global surplus. Governments and investors around the world are watching the UK referendum amid concern that a so-called Brexit would spark turmoil across global markets.
US crude futures gained 6.8% in the previous two trading sessions amid growing expectations the country would vote to remain in the EU.
"Oil prices remain largely sentiment-driven," analysts at Commerzbank led by Eugen Weinberg in Frankfurt, said in a report. "Recent days have shown just how quickly public opinion can shift" in the UK referendum campaign, and "against this backdrop today’s price losses make sense."
West Texas Intermediate for July delivery, which expires Tuesday, lost as much as 50 cents to $48.87 a barrel on the New York Mercantile Exchange and traded at $48.96 at 10:53 a.m. London time. Prices rose $1.39 to close at $49.37 a barrel on Monday. Total volume traded was about 48% below the 100-day average.
The more-active August contract was 36 cents lower at $49.60.
US stockpiles
Brent for August settlement fell as much as 60 cents, to $50.05 a barrel on the London-based ICE Futures Europe exchange. The contract rose $1.48, to $50.65 a barrel on Monday. The global benchmark crude traded at a premium of 59 cents to WTI for August.
US crude inventories dropped for a fourth week to 531.5 million barrels through June 10, according to data from the Energy Information Administration. Drilling activity rose for a third week through Friday, with companies adding nine rigs to boost the total to 337, according to data from Baker Hughes.
Nigeria’s presidency is "not aware" of a ceasefire with militants targeting oil facilities in the Niger Delta region, Femi Adesina, President Muhammadu Buhari’s spokesperson, said by phone from capital, Abuja.
Lagos-based newspaper ThisDay reported earlier that the government had agreed to a 30-day truce with militants including the Niger Delta Avengers, allowing Buhari to come up with plans to develop the region’s economy.
Nigeria’s production has sunk to the lowest since 1988 as a result of the assaults, according to the International Energy Agency.
Oil-market news:
Marathon Oil Corporation will increase drilling activity as prices climb above $50 a barrel, according to chief executive officer Lee Tillman. Saudi Arabia cut shipments in April to the lowest level in six months as overseas refineries bought less due to seasonal maintenance and the kingdom burned more oil at home to power air conditioners.
Petrofac, an oil services company, is not seeing projects being cancelled, although some plans are being reworked, the company’s chief financial officer Tim Weller said on a conference call on Tuesday.
China increased strategic crude purchases in May, hoarding 1.15 million barrels a day compared with 1.02 million barrels a month earlier, according to Bloomberg calculations based on General Administration of Customs data.