NEW YORK (Reuters) – Oil prices rose to near eight-week highs on Wednesday, with Brent crude futures at over $50 a barrel, as a fall in U.S. inventories bolstered expectations that the long-oversupplied market was moving toward balance.

Brent crude futures LCOc1 were up 67 cents to $50.87 a barrel by 10:39 a.m. EDT (1439 GMT). Prices surpassed levels seen Tuesday when Brent futures strengthened more than 3 percent.

U.S. West Texas Intermediate futures CLc1 climbed 83 cents to $48.72 a barrel.

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

Crude inventories fell 7.2 million barrels in the week ending July 21, more than the expected decrease of 2.6 million barrels. The decline was the fourth consecutive drop, giving support to the market.

This added to hopes a long-awaited rebalancing was underway in the oil market. Saudi Arabia said on Monday it would limit oil exports to 6.6 million barrels per day (bpd) in August, down nearly 1 million bpd from a year earlier.

“Today’s report has strengthened the bullish sentiment already prevailing in the market, although the longevity of the move remains in doubt,” said Abhishek Kumar, Senior Energy Analyst at Interfax Energy’s Global Gas Analytics in London. “Nevertheless, the country’s crude and gasoline stockpiles remain above their five-year averages, which will cap price gains.” (by Jessica Resnick-Ault, Rueters)

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