"Expectations were high for this report, and they were dashed," said John Kilduff, partner at New York energy hedge fund Again Capital.
Brent crude oil futures fell $2.37, or 4.8 percent, to $46.43 per barrel on Thursday. It rose 1.6 percent earlier to a session high of $49.59.
U.S. West Texas Intermediate (WTI) settled at $45.14 a barrel, down $2.29, or, 4.83 percent, breaking through the $46 resistance level, according to Kilduff. WTI also settled at its lowest level since May 10.
The next resistance levels are $43 to the downside and $47.50 on the upside, he said.
Oil prices have risen more than 70 percent from 12-year lows of around $27 for Brent and $26 for U.S. crude in the first quarter, driven by unexpected crude supply outages from Nigeria to Canada.
U.S. gasoline inventories also fell less than expected in the government report, slipping 122,000 barrels versus forecasts of 353,000 barrels, adding to fears of a glut of the motor fuel despite the busiest season for driving.
Vessels carrying gasoline-making components could not unload at the New York Harbor delivery point for futures this week because of lack of space.
After the data, U.S. gasoline futures fell 4 percent to about $1.37 per gallon.
Preliminary weekly data showed U.S. production fell by 194,000 barrels per day, primarily due to declines in Alaska's output, EIA reported. Monthly data that operates on a significant lag is more accurate.
Meanwhile, the EIA data showed gasoline supplies rose by 46,000 barrels per day to more than 9.75 million barrels per day.