By Scott DiSavino

NEW YORK (Reuters) -Oil prices were little changed on Thursday as concerns lower crude production in Libya offset worries that rising coronavirus cases in India and Japan would cause energy demand to decline.

Brent futures rose 8 cents, or 0.1%, to $65.40 a barrel by 11:30 a.m. EDT (1530 GMT), while U.S. West Texas Intermediate (WTI) crude rose 7 cents, or 0.1%, to $61.42.

Earlier on Thursday, both benchmarks were on track to decline for a third day in a row to their lowest closes since April 13.

“The market realized that a global come-back in oil demand cannot come without a come-back of the world’s largest economies,” said Bjornar Tonhaugen, head of oil markets at Rystad Energy, noting “India is diving deeper and deeper into a major crisis with infections setting new records every day.”

India, the world’s third-largest oil user, on Thursday reported the world’s highest daily increase to date with 314,835 new coronavirus cases.

Indian Oil Corp Ltd’s (IOC) refineries are operating at about 95% of their capacity, down from 100% at the same time last month, two sources familiar with the matter told Reuters.

Japan, the world’s No.4 oil importer, is expected to announce a third wave of lockdowns affecting Tokyo and three western prefectures, media reported.

Adding to underlying bearish sentiment was progress on talks between Iran and world powers to resurrect the 2015 nuclear accord, said PVM oil analyst Tamas Varga. Analysts have said Iran has the potential to provide about 1-2 million barrels per day (bpd) in additional oil supply if a deal is struck.

Any increase in supply from Iran would come on top of the extra barrels expected to come from the Organization of the Petroleum Exporting Countries and allies, including Russia, a group known as OPEC+, which plans to bring back about 2 million bpd of production over the next three months.

OPEC+ members are due to meet next week but major changes to policy are unlikely, Russia’s deputy prime minister and OPEC+ sources said.

“We are not currently viewing any of the apparent bearish drivers that have weighed on the complex this week as sufficient to sustain price weakness from here especially with Libyan supply still being reduced,” said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois.

Libya’s oil production fell to about 1 million bpd in recent days and could drop further due to budgetary issues, the National Oil Corporation said on Thursday.

The European Central Bank left policy unchanged as expected, keeping copious stimulus flowing even as it predicted a firm rebound in the euro zone economy in the coming months as pandemic restrictions are lifted.

Longer term, oil demand will take a hit as more countries adopt policies to combat climate change.

The Biden administration on Thursday pledged at a U.S. climate summit attended by world leaders to slash U.S. greenhouse gas emissions in half by 2030.

Japan, meanwhile, raised its target for cutting carbon emissions to 46% by 2030.

(Additional reporting by Julia Payne in London and Yuka Obayashi in Tokyo; Editing by Marguerita Choy and Elaine Hardcastle)