Crude holds at $118.30

Oil rose slightly after US government data showed a bigger-than-expected decline in gasoline stocks ahead of the summer driving season, offsetting a build in crude inventories.

US crude for June rose 23 cents settling in at $118.30 a barrel.

London Brent crude rose 51 cents to $116.46 a barrel, after hitting a record $116.75 the previous session.

US crude oil stocks rose 2.4 million barrels last week, according to the US Energy Information Administration, above analyst forecasts.

"Overall, the stats were bullish. Gasoline stocks fell more than expected, most in Padd 1 (East Coast)," said Tom Bentz, analyst for BNP Paribas Commodities Futures in New York.

US gasoline futures hit a new record after government data showed a 3.2 million barrel drop in inventories last week as the United States gears up for summer holiday travel.

Oil has surged above $100 this year in response to booming demand from emerging markets such as China plus under-investment in new oil supplies that have contributed to a fivefold increase in prices since 2002.

Further support came from potential disruptions stemming from a strike at the Grangemouth refinery in Scotland.

Union and management representatives are in talks to avoid the two-day stoppage, scheduled to start on Sunday, which could cause a reduction in flows of North Sea oil and natural gas production.