Oil prices crept up toward $71 a barrel on Tuesday, spurred by record fuel imports to the world's second biggest energy user China, but the market was cautious ahead of the next sets of supply and demand data.
U.S. crude rose 13 cents to $70.73 by 6:27 a.m. EDT. London Brent crude gained 12 cents to $73.62.
Imports to China surged by 42 percent in July to a record 4.62 million barrels per day as refiners raised output.
Traders are braced for monthly reports from the Organization of the Petroleum Exporting Countries for release at 6:50 a.m. EDT and the U.S. government's Energy Information Administration (EIA) at 12 p.m. EDT, which give insights into supply and demand.
The focus is going to be definitely on the demand and people will look for green shoots and upwards revision, said Petromatrix analyst Olivier Jakob.
The United States last Friday reported the first fall in the unemployment rate for 15 months, prompting some oil analysts to anticipate a faster economic recovery, which could revive oil demand.
Analysts will also be watching weekly U.S. inventory data late on Tuesday, followed by weekly U.S. government data on Wednesday.
The weekly data is expected to show gasoline stocks will have dropped by 1.5 million barrels in the week ending August 7.
Distillate stocks, including diesel, were also seen lower, but overall crude stocks were expected to fall as refineries cut run rates.
Analysts said the slew of weekly and monthly reports had helped steer the focus back to the fundamentals of supply and demand, although financial factors were still a major consideration.
For much of this year, the oil market has taken its cue from rallying equity markets and these have helped to tow prices up from lows of below $33 a barrel last December.
By the end of the week we will be back on to financials. It is these factors that are still in the ascendancy, said analyst Simon Wardell of Global Insight, adding that a stronger dollar could cap gains on oil.
A stronger dollar makes dollar-denominated commodities such as oil less attractive to non-dollar buyers.
The dollar's direction could depend on the policy-setting Federal Open Market Committee (FOMC) meeting on Tuesday and Wednesday, although it is not expected to change interest rates in the near term.
(Additional reporting by Maryelle Demongeot; Editing by Barbara Lewis and Sue Thomas)