U.S oil futures ended lower on Friday, tumbling as the dollar strengthened and a supply glut in top consumer the United States trumped worries about falling production from Libya.
U.S. crude settled down 2 percent, or $1.11, at $54.73 a barrel in thin trade as many countries were still on Christmas holiday. The contract has declined some 4 percent this week.
Brent crude was last trading about 70 cents lower at $59 a barrel.
The market had come under pressure from Wednesday's DOE report, which showed a 7.3 million-barrel rise in crude inventories to their highest December level on record. Analysts had expected a seasonal decline.
The slide was exacerbated as oil prices reacted to a strengthening dollar index.
"There's still significant weakness in confidence, and that means that we're going to have occasional retests to the downside," said Richard Hastings of Global Hunter Securities. The strenghtening dollar index triggered the slide Friday, he said.