Oil up

London

Oil prices held just below eight-week highs on Thursday, supported by a steeper-than-expected decline in U.S. crude inventories that boosted expectations of a shift to a more balanced market.

Brent crude futures dipped 9 cents at $50.88 a barrel at 0950 GMT, after rising about 1.5 percent in the previous session.

U.S. crude stocks fell sharply last week as refineries increased output and imports declined, while gasoline stocks decreased and distillate inventories dropped, the Energy Information Administration said on Wednesday.

The 7.2 million-barrel drop in inventories in the week ended July 21 was much more than the 2.6 million barrels forecast. "As encouraging as this may seem, the price recovery won’t begin in earnest until evidence of U.S. oil rebalancing is mirrored on a global scale," Stephen Brennock at oil brokerage PVM said referring to the drawdown in oil stocks.