Oil prices rallied 4 percent on Thursday as traders' focus on strong U.S. demand for gasoline overshadowed news of increased U.S. inventories of crude.
A weaker dollar also made dollar-denominated crude more affordable to holders of the euro, while higher equity prices on Wall Street enhanced bullish sentiment in oil markets.
U.S. Energy Information Administration data on Thursday showed demand over the latest four-week period was up almost 4 percent from a year ago, while gasoline inventories rose just about half of expected levels last week.
The attention paid to gasoline inventories overrode interest in EIA data showing stockpiles of U.S. crude oil rose nearly 2.6 million barrels last week, more than double the build of 933,000 barrels forecast by analysts in a Reuters poll.
The rise was mitigated, however, by a crude drawdown at the Cushing, Oklahoma delivery point for U.S. crude.