Oil reversed early losses this evening as data showing oil demand could be recovering in the US outweighed doubts about the strength of the global economy.
US crude was up $1.49 at $70.68 a barrel, having earlier hit a high of $71.35. London Brent crude was up $1.03 at $73.40.
The US Energy Information Administration (EIA) said crude stocks in the world's largest energy consumer fell by 8.4 million barrels last week. Analysts had expected a rise.
Some analysts urged caution as oil imports to the US slumped to their lowest level since September 2008, but stocks of petrol and distillates such as heating oil also fell, boosting the view that demand might be bottoming out after being curbed by the recession.
Prices had fallen earlier in the day after a near-5% slump in Chinese shares sent doubts rippling through global markets about the strength of the world economic recovery.
Traders also watched for storms in the Atlantic Basin but there was no immediate threat expected to US oil installations in the Gulf of Mexico. Hurricane Bill, the first of the 2009 Atlantic season, grew into a major Category 4 storm today, as it moved closer to Bermuda.
