Oil prices eased yesterday as the market’s focus returned to oversupply as production from Nigeria and Canada revived, and Opec output reached a record high in June.

Despite yesterday’s losses, oil prices were on track for the first weekly gain in three weeks after a bullish run this week on strong buying following Britain’s vote in favour of leaving the European Union.

Global benchmark Brent crude futures were down 17 cents at $49.54 a barrel at 1203 GMT.

US West Texas Intermediate (WTI) crude was trading at $48.18, down 15 cents day on day.

“Oil has settled down after the initial short covering squeeze earlier in the week,” said Ole Hansen, commodity strategist at Saxo Bank in Copenhagen.

“A rising contango indicates that the market is getting ready to absorb returning supply from Nigeria and Canada.”

Militant attacks in Nigeria had brought production to the lowest in 30 years but no new attacks have been carried out since June 16, allowing production to slowly ramp up.

In Canada, oil sands output was also gradually increasing after wildfires had curtailed production. As of Wednesday, around 400,000 barrels per day of production were still affected in the Fort McMurray area.

Adding to oversupply concerns, a Reuters survey showed Opec production rose to a record high in June. Stronger supply from major Middle East producers, except Iraq, underlined their focus on maintaining market share.

Despite growing signs of lingering oversupply, US Energy Secretary Ernest Moniz said yesterday he expected oil supply and demand to balance by 2017.

Analysts at Barclays took a different view, cutting their crude price forecasts on the back of expectations for reduced economic growth and oil demand following Britain’s vote to leave the EU.

The bank trimmed its Brent and WTI price forecasts for 2016 by $3 each, to $44 and $43 a barrel.

“Markets have experienced only the tip of the iceberg in terms of the impact of the UK’s ‘leave’ vote,” analysts said in a note.