* Traders take profits after steep April Brent, WTI rallies
* Record U.S. crude stocks also weigh on market
* Falling U.S. production, weak dollar seen as supports
By Henning Gloystein
SINGAPORE, April 28 (Reuters) - Crude futures pulled back
from 2016 highs early on Thursday as traders locked in profits
after April's sharp rally, but analysts said falling U.S.
production and strong investor appetite could push prices
higher.
International Brent crude futures LCOc1 were trading at
$47.02 per barrel at 0045 GMT, down 16 cents from their last
settlement, and U.S. West Texas Intermediate (WTI) futures
CLc1 were down 12 cents at $45.21 a barrel.
The price dip came after both crude benchmarks hit 2016
highs the previous day in what has been one of the steepest
price rises in recent years. Both Brent and WTI have rallied
more than 70 percent since their respective 2016 lows in January
and February.
Analysts said falling output in the United States and a weak
dollar were pushing prices up and attracting investors.
"The recent trend of rising crude oil prices received
another boost after U.S. output was shown to have fallen again
last week," ANZ bank said, following a release by the U.S.
Energy Information Administration (EIA) showing that crude oil
production fell to 8.94 million barrels per day (bpd) last week,
down almost half a million bpd from this time last year.
The output fall outweighed bearish data showing that U.S.
crude stocks climbed 2 million barrels last week to an all-time
peak of 540.6 million barrels, traders said.
However, the record crude storage figures may have spurred
some traders to take take profits in Thursday morning trade by
closing long positions, they added.
ANZ said that further bullish momentum could emerge due to
ongoing weakness in the dollar, which is down over 5 percent
this year against a basket of other leading currencies .DXY ,
as a weaker greenback makes dollar-traded crude cheaper to buy
for countries using other currencies at home.
"Investors should take comfort from a relatively market
neutral FOMC (U.S. Federal Open Market Committee) statement.
With fundamentals continuing to improve, this should see them to
add to their already bullish positions in coming days," ANZ
said.
The Federal Reserve said on Thursday that it would leave
U.S. interest rates unchanged and that it was in no rush to hike
rates soon.
(Editing by Richard Pullin)