Oil prices rose today as data showing a big increase in Chinese demand, along with a weak dollar, offset persistent worries about the fiscal outlook for top energy consumer the United States.

Support also came from late short-covering ahead of the long US Memorial Day holiday weekend, which will keep US markets shut on Monday.

US crude futures settled up 62 cents at $61.67 a barrel, while London Brent rose 85 cents to settle at $60.78 a barrel.

"We can say China oil demand news was supportive, but it appears the dollar falling to new lows for 2009 is providing the main support for crude this morning," Tom Bentz, analyst at BNP Paribas Commodities Futures, said in a Reuters report.

The US dollar touched the lowest level this year today, lifting commodities denominated in the greenback.

In the United States, refinery fires pushed up gasoline prices ahead of the Memorial Day holiday this weekend, which kicks off the country's summer driving season.

In China, the world's second-largest energy consumer, apparent oil demand rose 3.9% in April from a year earlier, data showed today.

It was the first significant rise since October.

Oil traders were expected to shift their focus to next week when Opec will meet to review its output policy on Thursday.

Opec is expected to keep its official production levels unchanged as rising prices have eased pressure on budgets, and there are hints of economic recovery during the next year, a Reuters poll showed.