Oil steady on falling crude inventories, but rising output weighs

Oil prices were little changed in early trade on Thursday, holding most of their gains from the previous session after another fall in U.S. crude inventories which is seen as a sign of a tighter market.

Brent crude futures, LCOc1 the international benchmark for oil prices, were at $52.48 per barrel at 0103 GMT, down 9 cents from their last close.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $48.31 a barrel, down 10 cents.

Crude futures rose more than 1 percent on Wednesday, also buoyed by potential output disruptions from a storm approaching the Gulf Coast.

Traders said that ongoing declines in U.S. commercial crude storage levels were a sign of a gradually tightening market, although another rise in output held the market back, they said.

"Another strong drawdown in U.S. crude oil inventories should see oil prices well supported," ANZ bank said, although it added that "there was a hint of cautiousness, with U.S. oil output continuing to push higher."

U.S. oil production hit 9.53 million barrels per day (bpd) last week, the highest level since July 2015 and up over 13 percent from their most recent low in mid-2016. C-OUT-T-EIA

Despite this, U.S. crude stocks fell last week and gasoline stocks were down as well, the Energy Information Administration said on Wednesday. nL2N1L90VG

Crude inventories fell by 3.3 million barrels in the week ending August 18, to 463.17 million barrels, down 13.5 percent from their record levels last March. C-STK-T-EIA