Oil prices plunged on concerns over the global oil glut. The U.S. Energy Information Administration (EIA) released its crude oil inventories data on Wednesday. U.S. crude inventories fell by 4.407 million barrels to 455.3 million in the week to July 31. But oil production in the U.S. rose to 9.47 million barrels in last week from 9.41 million in the previous week.

Concerns over the global oil glut grew due to a global economic slowdown and a nuclear deal with Iran.

Market participants are awaiting the release of the U.S. labour market data. Analysts expect that U.S. unemployment rate is expected to remain unchanged at 5.3% in July. The U.S. economy is expected to add 218,000 jobs in July, after adding 223,000 jobs in June.

A stronger U.S. dollar due to the better-than-expected U.S. labour market data could put oil prices under more pressure.

Market participants are also awaiting the release of the number of active U.S. rigs.

WTI crude oil for September delivery dropped to $44.29 a barrel on the New York Mercantile Exchange.

Brent crude oil for September fell to $49.33 a barrel on ICE Futures Europe.