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US prices had rallied on growing talk of a possible extension of the OPEC-led production-cut deal.

Futures added 0.5 per cent, ending the session within a dime of Monday's five-month closing high.

But whether this demand growth is sustainable is also a key uncertainty, with question marks over whether Chinese policy makers will continue with stimulus, or whether they will ease off the infrastructure and construction spending that has driven fuel consumption.

Brent was down 62 cents at $57.28 a barrel, after hitting a more than two-year high of $59.49 on Tuesday after Monday's referendum vote prompted Turkey to threaten to close the region's oil pipeline. U.S. crude exports rose to a record 1.5 million barrels a day last week, according to the U.S. Energy Information Administration.

Ed Morse, global head of commodities for Citigroup, remarked, "We're seeing more and more evidence that it's not the worldwide oil companies, it's not the independent oil companies that are lagging new investments, but it's OPEC countries lagging, particularly those five". The Russian energy minister said OPEC did not agree on a freeze beyond March 2018, making it a key date for the oil industry.

Trafigura's view that demand is set to outstrip supply mirrors Citigroup, whose global head of commodities said that a market squeeze may emerge as early as 2018. She is predicting that average WTI will fall below US$50s per barrel next year due to higher American shale oil production and expiry of the OPEC production cutting agreement.

The growing USA oil demand after Harvey coincides with rising crude prices.

Even at Syncrude Canada, whose mining operations were hit by planned and unplanned outages earlier this year, the average break even price will be US$40.70 per barrel of synthetic crude, well below US$50, the bank said. The former suggests there is still an oversupply, the latter that stocks are tight.

We'll start (below) with the U.S. dollar's impact on crude oil. Harvey forced almost 25% of United States refining capacity to be closed, along with half a dozen ports and pipelines, according to Reuters, which cut off access to crude, leaving supply untouched, and lowering prices. Major world oil producers have also indicated that they will stick with output cuts to limit supply.

Brent crude oil prices have jumped to their highest level in eight months following a meeting of the Organisation of the Petroleum Exporting Countries (Opec) at which producers said the market was rebalancing.

Oil eased on Wednesday, edging lower for a second day, although an unexpected drop in USA crude inventories helped keep the price within sight of this week's 26-month highs.