April 6 (UPI) -- Crude oil prices posted steady gains once again as traders moved past data on steady oil storage levels in the United States, but the rally might not last.
Crude oil prices showed some fluidity in trading Wednesday, moving between gains and losses before ending the day on a high note.
"The oil market is regaining some ground as yesterday's angst provided by an unexpected increase in U.S. crude inventories fades," a broker at PVM said in a daily report on market fundamentals.
After the industry's American Petroleum Institute reported a drop in crude oil inventories, official U.S. data was a jolt with a report of 1.1 million barrels built back in during the previous week. Markets could be tightening somewhat, however, as regional refineries in the world's leading economy shift gears for the summer. Gasoline stocks declined for the previous week.
The price for Brent crude oil was up 0.64 percent about a half hour before the start of trading in New York to $54.71 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was up 0.65 percent to $51.48 per barrel.
A January start to an agreement led by the Organization of Petroleum Exporting Countries to limit production in an effort to balance an over-supplied market put a floor under crude oil prices at around $50 per barrel. The price has improved to the point, however, that U.S. crude oil production is recovering from last year's slump. The most recent data show U.S. output is already back to where it was at the end of 2015, offsetting some of the designs of the OPEC-led declines.
"Forcing U.S. crude oil stocks to draw from record levels down to the five-year average rather than to just draw on normal seasonal pattern requires a much sharper reduction of imports from OPEC countries," Olivier Jakob, managing director of Switzerland-based consultant Petromatrix, said in a daily newsletter.
Elsewhere, production from Libya is expected to recover in the coming weeks after some of its output was sidelined by conflict. In the North Sea, the Buzzard oilfield was restarted. Its unplanned closure for two days contributed to the rally in crude oil prices earlier this week.
PVM in its report warned some of the modeling for price movements could be foreboding.
"It is advised to tread carefully as the price action edges closer to what are hazardous resistances and brace for another failure," its report read.