Oil prices rose on Thursday, extending a more than 3% rally in the previous session, boosted by record U.S. crude exports and a weaker U.S. dollar, though gains were capped in Asia due to lingering fears over slack demand in China. Also, energy stocks led Wednesday's S&P sector standings. Among other names, Hess (HES) closed +4.8% as the top gainer, Halliburton (HAL) ended +4.3% and rising for the 4th straight session to its best level since mid-June, and Schlumberger (SLB) touched a four-year high before fading to finish -0.6%.

U.S. crude stocks rose 2.6 million barrels last week, according to weekly U.S. government data on Wednesday, with crude exports rising to 5.1 million barrels a day, the most ever. Brent crude futures gained 0.65%, to $95.44 a barrel by 1332 GMT. U.S. West Texas Intermediate (WTI) crude climbed 0.71% to $87.57 a barrel regaining its 50-day moving average of $86.72.

The World Bank on Wednesday said it expects energy prices to decline by 11% in 2023 after this year's 60% surge following the Russia-Ukraine conflict, although slower global growth and Covid-19 restrictions in China could lead to a deeper fall.

Meanwhile, the dollar's weakness added support, as the greenback's strength of late has been a notable factor inhibiting oil market gains. The dollar retreated on Thursday as market expectations mounted that the U.S. Federal Reserve will tone down its aggressive stance on interest rate hikes.