Growth reported Thursday in the U.S. economy helped lift oil prices out of a hole after falling in response to reports of a build in crude oil stockpiles.

Oil prices meandered between weak losses and gains early Wednesday amid competing market narratives. Norway and Libya, a member of the Organization of Petroleum Exporting Countries exempt from a production cut deal, reported gains in crude oil production. Industry estimates from the United States, meanwhile, forecast a draw in crude oil inventories, suggesting some supply-side strains were easing.

Oil prices turned lower, however, after the U.S. Energy Information Administration reported a larger-than-expected climb in crude stockpiles at 2.3 million barrels for the week ending Dec. 16.

Oil was trending lower in overnight trading Thursday, but moved up at the start of the trading day in New York following a report on U.S. gross domestic product for the third quarter. The price for Brent crude oil was up 0.8 percent to open the trading day at $54.85 per barrel. The U.S. benchmark price, West Texas Intermediate, was up 0.6 percent to start the day at $52.81 per barrel.

The Commerce Department reported GDP in the third quarter grew at a revised 3.5 percent in the third quarter, up from the previous estimate of 3.2 percent and more than twice the rate reported during the second quarter of the year.

Corporate profits increased $117.8 billion in the third quarter, compared with a decrease of $12.5 billion in the second quarter. The strengthened economy could support greater demand in the U.S. economy, but add support to more aggressive rate policies from the U.S. Federal Reserve.

A report from the Colorado Office of State Planning and Budget said aggressive rate policies in the past were met by a rise in the value of the U.S. dollar, which weighed on industrial production and global growth during 2015 and early 2016.

Oil prices fight dueling market trends
New York (UPI) Dec 21, 2016 - Oil prices were pulled by competing factors Wednesday with indications of fading supply-side issues in the U.S. market balancing production growth overseas.

Indications surfaced early in the week that U.S. crude oil stockpiles were dwindling in a short-term sign of fading supply-side pressures. The American Petroleum Institute reported late Tuesday that stocks dropped by 4.1 million barrels.

S&P Global Platts said official figures from the U.S. government are expected to show a draw of about 2 million barrels for the week ending Dec. 16. Platts analysts said some of the draw may be because companies are shedding inventory for year-end tax purposes.

Crude oil prices inched up only marginally ahead of the release of official data from the U.S. Energy Information Administration. The price for Brent crude oil was up 0.05 percent to start the day at $55.38 per barrel. The U.S. benchmark price for oil, West Texas Intermediate, was up 0.3 percent to open in New York at $53.45 per barrel.

Speaking to broadcaster Rossiya-24, Russian Oil Minister Alexander Novak said crude oil prices could flirt with $60 per barrel, but it was unlikely the market would return to the levels from two years ago when oil was above the $100 mark.

On the production side, both Norway and Libya reported gains in crude oil production, putting pressure on efforts by the Organization of Petroleum Exporting Countries to erase the oversupply. Libya is exempt from an OPEC deal to cut production and said its crude oil was flowing freely for the first time in years.

Olivier Jakob, managing director of Switzerland-based consultant Petromatrix, said in an emailed report that major movements in prices could be muted during the year-end holiday season, but Libya could be a determining factor once trade resumes in earnest in 2017.

"The price action between Christmas and New Year can be driven by all sorts of end-of-year interests," he said. "However, when we return to a full market in early January, if Libya is indeed back, we expect that it will start to weigh on speculative sentiment."

Bankers are skeptical that all parties to the OPEC maneuver will hold true to their word. Russia, which would account for much of the non-OPEC cuts, has been fluid on its stance on production.