Crude oil prices notched early gains in Thursday morning trading on signs of some market balancing, though caution was urged about trajectory.

"We are experiencing an unusual phenomenon this morning -- oil prices are rising," a morning report emailed from London oil broker PVM read.

Crude oil prices staged a weak recovery Wednesday morning, though the rally faltered by the end of the trading day. Traders may be moving on bargains, though both U.S. commercial crude oil and gasoline inventories posted declines last week, according to the U.S. Energy Information Administration.

"One bullish factor in this report was the import number, which declined by 149,000 barrels per day during the week," Jenna Delaney, a senior oil analyst for Platts Analytics said in an emailed report. "The market has been looking for evidence that lower production in Saudi Arabia is showing up in lower imports to the U.S.; recent figures are suggestive of that prospect."

Crude oil prices were in clear positive territory about 45 minutes before the start of trading in New York. Brent crude oil was up 0.76 percent to $45.16 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was up 0.47 percent to $42.73 per barrel.

On the overall market situation revealed by the EIA, however, Delaney said the numbers "were fairly neutral."

Crude oil prices reacted to a late May decision by parties to an agreement led by the Organization of Petroleum Exporting Countries to extend a multilateral effort to balance the market through coordinated production declines. An official at the Kuwait Petroleum Corp. said Thursday the plan has so far failed to reach its goal of rebalancing the oil market, "mainly due to the reluctance of OPEC and non-OPEC producers to cut oil output."

On the economic front, markets could be reacting to Tropical Storm Cindy, which made landfall on the southern U.S. coast and is disrupting port activities. A storm unit for British energy company BP, however, had no statement on the storm's impact.

Labor figures from the United States could sway momentum. Last week, the U.S. Labor Department said unemployment rates were lower in nine of the 50 states and the District of Columbia for May.

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Iran: OPEC production cuts are difficult
Washington (UPI) Jun 20, 2017
Cutting back on production levels is a difficult task for members of the Organization of Petroleum Exporting Countries, Iran's oil minister said Wednesday. Iran ranks third among OPEC member states in terms of proven crude oil reserves. Production has been more or less steady since the fourth quarter of 2016 at 3.7 million barrels per day, though that's up about 8 percent from 2016. Whi ... read more

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