Oil prices settled 5 percent lower on Friday after Britain's vote to leave the European Union spurred massive risk aversion and a rally in safe havens like the U.S. dollar that threatened to cut short a three-month-long recovery in global oil markets.
Financial markets have been worried for months about what a British exit from the European Union, dubbed widely as 'Brexit,' would mean for Europe's future, but were clearly not fully factoring in the risk of a 'leave' vote.
The dollar index jumped about 2 percent, its most since 2008, while sterling collapsed to a 31-year low after British Prime Minister David Cameron, who campaigned to remain in the EU, said he would stand down by October.
A rallying dollar makes oil and other commodities denominated in the greenback costlier for holders of the euro and other currencies.
Brent crude settled down 4.9 percent, or $2.50, at $48.41 a barrel. It had fallen 6 percent earlier to $47.54. U.S. crude fell 5 percent, or $2.47, to settle at $47.64, its largest one-day decline since February.