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Friday's announcement of a Brexit outcome to the UK referendum has, at least for the time being, taken the wind out of crude oil's strongest rally since the financial crisis began, which saw prices nearly double since late February.

Crude oil has suffered a two-day drop of almost 8%, its biggest drop in nearly 5 months, as the unexpected Brexit news sent risk assets spiralling downward just as the American dollar, seen as a safe haven in uncertain times, has been sent surging upwards. Gains in the value of the American dollar are most often accompanied by dropping oil prices, as oil becomes less attractive to holders of other currencies, and the USD has moving upwards fast, gaining over 3% against the pound sterling.

The value of oil futures undulated last week in nervous anticipation of the Brexit vote and with conflicting inventory information being released, first as the American Petroleum Industry (API) told investors that there was 3 times less than expected inventories of oil and then, the following day, as the U.S. Energy Information Administration (EIA) nullified the earlier API report with its own report with numbers essentially indicating that, although stocks were indeed down, the API estimation had been wildly exaggerated.

Monday morning's release of market intelligence firm Genscape's bi-weekly measurements of the oil storage tanks at Cushing Oklahoma, the most important crude oil trading hub in the world, stating an inventory draw of more than one million barrels for the week ending June 24th, did little to pare the losses being suffered due to the enormously overpowering wave of Brexit news.

Rob Haworth, senior investment strategist at U.S. Bank Wealth Management, maintains a cautiously optimistic long term outlook for oil futures. "For the oil market, Brexit is important in the near term, but not so much in the long term, unless a global recession is the result," he said, adding that he doesn't expect a global recession and believes that we will see a "pivot in the next week or so back to fundamentals."

In the end, US benchmark West Texas Intermediate (WTI) fell $1.31, or 2.8 percent, to settle at $46.33 US a barrel on the New York Mercantile Exchange, its lowest finish since June 16th with an intraday low of $45.83 matching a one-month trough hit on June 17th, and London’s Brent North Sea crude settled down $1.25, or 2.6 percent, at $47.16 US a barrel with a session low of $46.69, its lowest point since May 10th.

The day's main influences, the bears and bulls:

The Bears:
Ongoing market reaction to news that the UK has voted to leave the European Union

The Bulls:
Market intelligence from Genscape reporting a greater than 1 million barrel draw for the week ending June 24th at Cushing Oklahoma

In the days to come, watch out for the following key catalysts for the crude oil market:

- June 28th: API (American Petroleum Inventory) report, release time 21:30 UTC

- June 29th: EIA's Petroleum Status Report, release time 15:30 UTC

- July 1st: Baker Hughes’s North American rig count, release time 18:00 UTC.