The price of oil has dropped below $50 in New York trading for the first time since December as concerns that Opec’s output cuts are failing to restrain record US stockpiles triggered the biggest slump in more than a year.

Iraq threw an obstacle in Opec’s path toward a final deal to stabilise oil markets when it balked at joining efforts to trim output to prop up crude prices.

Oil gained after Opec’s president said the group will hold informal talks in Algiers next month and predicted the current bear market would be short lived.

Brent crude rose as violence flared in Opec’s two biggest members Iraq and Saudi Arabia, raising tensions ahead of the producer group’s meeting on June 5 in Vienna.