Oil prices hit a record $68 a barrel on Thursday after the US reported a fall in gasoline stocks, while China said its crude imports had risen sharply.
Demand is strong and refinery capacity is limited
Fears that tropical storm Katrina might hit production in the Gulf of Mexico also pushed the cost of oil higher.
US light crude touched $68 a barrel in Asian trade before finishing the day at $67.49. London's Brent crude touched $66.56 before closing at $66.27.
Demand from the US, China and India is expected to keep oil prices high.
US stocks of gasoline fell by 3.2 million barrels last week to 194.9 million barrels, the US Department of Energy said on Wednesday - 7% below 2004 levels.
On the other hand, US supplies of crude oil rose by 1.8 million barrels to 322.9 million barrels, the government said.
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As for China, the country's General Administration of Customs said on Thursday that imports of crude oil in July totalled 11.1 million tonnes of crude oil - an average of 2.62 million barrels a day.
China's crude oil imports have risen 5.4% in the first seven months of this year. The US and China are the world's biggest oil consumers.
"Contrary to all the situations in the past that were very much related to reduction of supply, the main reason for the actual oil prices are certainly demand forces," said Rodrigo Rato, managing director of the International Monetary Fund.
"You have very strong demand (from the US, China and India) and you don't see that demand receding," he said.
Mr Rato said restricted refinery capacity would keep prices high in the short term.
Meanwhile, the US National Hurricane Center warned that tropical storm Katrina, which formed in the Bahamas on Wednesday, could reach the Gulf of Mexico in the next few days.