LONDON, July 20 Reuters Oil prices crept higher on Thursday as a lowerthanexpected drop in U.S. crude inventories and a weaker demand outlook kept investors cautious.

September Brent futures climbed 6 cents, or 0.1, to79.52 a barrel by 0929 GMT, while August U.S. West Texas Intermediate WTI crude gained 21 cents, or 0.3, to 75.56 a barrel.

The August WTI contract expires on Thursday. The more active September WTI crude was 8 cents, or 0.1, higher at 75.37.

Prices fell in the previous session after data showed U.S. inventories fell less than analysts expected.

Yesterday39;s U.S. EIA Energy Information Administration oil stock report proved something of a disappointment for those that were looking for inspiration, PVM Oil analysts said.

China39;s economic recovery following its end to COVID19 curbs has fallen short of expectations. Its oil imports yearonyear surged by nearly half in June, but at the same time stock levels rose to near an alltime high. Traders said China had been pragmatically buying discounted Russian crude.

The Organization of the Petroleum Exporting Countries and the International Energy Agency have said China39;s demand is expected to continue to rise in the second half of this year and remain the main driver of global growth.

China39;s imports of crude oil from Russia hit an alltime high in June, Chinese government data showed on Thursday, even as discounts against international benchmarks narrowed.

Crude prices may struggle to find a clear…