The Brent crude oil price fell 4.6 percent in a single day after China devalued its currency against the dollar and OPEC said that the cartel's oil production rose in July.
The price of the global benchmark Brent crude oil fell to $49.29 per barrel early Wednesday morning, after reaching as high as $51.69 per barrel on Tuesday, according to official figures. However, the Brent price came back to around 1.5 percent later on Wednesday to climb above $50 per barrel at 0900 GMT.
The People's Bank of China reduced the value of the country's currency, the renminbi, against the dollar by almost four percent on Tuesday and Wednesday. The bank is seeking to link the value of the currency to international market trends, according to a statement released on Tuesday.
Growth is slowing in China: Annual GDP growth was 7.4 percent in 2014, the lowest since 1990, when it saw 3.8 percent, and well below the double digit growth rates seen between 2003 and 2007, according to World Bank data.
"Devaluation is reducing China's purchasing power for crude oil," a commodities economist at Capital Economics, Thomas Pugh, told Anadolu Agency.
The slowdown in China and the currency devaluation suggest to traders that crude demand in China will be reduced, he added.
Moreover, the Organization of the Petroleum Exporting Countries (OPEC) announced Tuesday that its oil output rose in July.
The cartel's total crude production increased by 100,000 barrels per day month-on-month, to 31.5 million barrels a day in July, from 31.4 million barrels per day the previous month.
"Rising OPEC oil production is also creating downward pressure on prices," Pugh said.
However, OPEC expects global oil demand to grow by 1.38 million barrels a day this year to reach 92.7 million barrels per day, a level that is around 90,000 higher than its projection last month.