NEW YORK: Oil prices rose on Friday and were poised for a third week of gains as market sentiment turned more upbeat amid signs a persistent global supply glut may be easing.

Strong gasoline consumption in the United States, increasing signs of declining production around the world and oilfield outages have underpinned a return to investment in the sector, traders said.

"The current rally is driven by a market sentiment that is becoming more and more convinced that the worst is over and the global oil market rebalancing process is already in play," said Dominick Chirichella, senior partner at the Energy Management Institute in New York.

Brent futures were up 1.1 percent to $45.02 per barrel by 1:37 p.m. EDT (1737 GMT). US West Texas Intermediate crude was also up 1.1 percent at $43.66 a barrel. Both contracts jumped as much as 3 percent during the session.

The rally was somewhat limited by profit-taking ahead of the weekend, brokers said.

Brent has surged 4.4 percent so far this week and US crude 8.2 percent as both benchmarks headed for a third week of gains. Crude is up more than two-thirds since its 2016 lows between January and February.

Traders also pointed to strong crude imports to China in March as providing support to prices.

Still, some analysts warned that the oil market was still far from balancing supply and demand.

"While this recent rally has the potential to run further to the upside ... we believe that it is not yet driven by a sustainable shift in fundamentals," Goldman Sachs said in a note to clients.

The Wall Street bank maintained its view that a sustainable balancing of the market, driven by declines in US shale oil production, would take place in the third quarter of 2016.

Many analysts have said they expect producers in the US to take every opportunity to aggressively hedge by selling as soon as oil prices recover for short periods of time. This would have a tendency to pressure prices in later months, which could in turn limit front-month gains.

Sure enough, EOG Resources placed hedges for nearly 10 million barrels of crude oil in the first quarter through June 30, according to a regulatory filing this week.

Falling output, especially in the United States, where many producers have reeled from an up to 70 percent oil price rout since mid-2014, has helped to lift the market.

US energy firms cut oil rigs for a fifth week in a row to the lowest level since November 2009, oil services company Baker Hughes Inc. said Friday, as energy firms continue to slash spending despite a bigger than 60 percent spike in futures since hitting a near 13-year low in February.

Drillers cut eight oil rigs in the week to April 22, bringing the total rig count down to 343 Baker Hughes said in its closely followed report.

The number of US oil rigs currently operating compares with the 703 rigs operating in the same week a year ago. In 2015, drillers cut on average 18 oil rigs per week for a total of 963 for the year, the biggest annual decline since at least 1988 amid the biggest rout in crude prices in a generation. Before this week, drillers cut on average 12 oil rigs per week for a total of 185 so far this year. Energy firms have sharply reduced oil and gas drilling since the collapse in crude markets began in mid-2014.

US crude futures fell from over $107 a barrel in June 2014 to a near 13-year low around $26 in February.

Schlumberger NV said in earnings release on Friday it will remain cautious in adding capacity even after energy firms show signs of recovery since it believes the industry will continue cutting costs through the coming quarter.

The world's No. 1 oilfield services provider said its first quarter revenue decrease was one of the steepest quarterly declines for the company since this downturn started driven in part by a drop in activity, persistent pricing pressure, project delays, job cancellations and activity disruptions.

Analysts at Cowen & Co, a US financial services firm, expect US oil and natural gas land rigs to bottom between 375 and 400 sometime in the second quarter before increasing in the fourth quarter. The total land rig count was 409 in the week ended April 15, according to Baker Hughes.

French investment bank Natixis said it expected US oil production to drop by at least 500,000 to 600,000 barrels per day (bpd) this year, compared with 2015, and by another 500,000 bpd in 2017.

Despite the recent rally, oil markets remain oversupplied as between 1 and 2 million barrels of crude are being pumped out of the ground every day in excess of demand, leaving storage tanks around the world filled to the brim with unsold fuel.