March 23 (UPI) -- Crude oil prices drifted lower in early Thursday trading as investors remained cautious about U.S. economic trajectory ahead of a pivotal vote on health insurance.
Crude oil prices faced lingering pressure in the previous session on signs of ongoing supply-side pressures despite efforts by the Organization of Petroleum Exporting Countries to offset the glut through managed declines.
Official U.S. data show a build of 1.3 million barrels in crude in oil inventories compared with last week. U.S. crude oil production, meanwhile, continues to show strength with oil at around $50 per barrel, adding 20,000 barrels per day from the previous week to reach 9.1 million barrels per day.
Broader markets may be unsettled Thursday as investors watch for developments from the Republican effort to replace the Affordable Care Act, the signature healthcare measure from President Barack Obama. The measure is facing stiff opposition from the some of the members of the Republican Party.
"Oil traders will watch the vote of the American health care act today and the fate of the bill may be an indicator of the ability of President Donald Trump to drive through his agenda on tax cuts and infrastructure spending," Phil Flynn, a senior market analyst for the PRICE Futures Group, said in a daily newsletter.
After posting modest gains overnight, the price for Brent crude oil was down about 0.3 percent in the minutes before the opening bell in New York to trade at $50.47 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was down 0.4 percent to $47.86 per barrel.
Olivier Jakob, managing director of Switzerland-based consultant Petromatrix, said in a daily newsletter that Brent crude oil was hovering around its 200-day moving average.
"In the near-term, we favor a trading range between $47.00 and $52.00 per barrel for WTI," Jakob wrote in the newsletter.
The price for Brent crude oil had hovered near $55 per barrel for most of the year on optimism surrounding OPEC production cuts. The price for oil came under pressure mid-March following steady reports of gains in oil storage and production in the United States, the world's leading economy.
Markets in general may face stronger headwinds on U.S. labor figures. The U.S. Labor Department reports first-time claims for unemployment for the week ending March 18 up 15,000 from the previous week. The less-volatile four-week moving average was 240,000, an increase of 1,000 from the previous week.