By midday, US benchmark oil for November delivery was up USD 1.52, or 1.5 per cent, to USD 103.13 a barrel on the New York Mercantile Exchange, reversing most of Wednesday's decline of USD 1.88 a barrel.
House Republicans said they would advance legislation to temporarily extend the government's borrowing authority so it can continue to pay its bills on time.
Though the Republicans' proposal could avert an unprecedented federal default that the Obama administration has warned could occur as early as October 17, it would not necessarily bring a quick end to the 10-day partial federal shutdown. Obama has insisted that Congress reopen the government and extend the debt limit without condition.
In the US, however, supplies remain high. The Energy Department said crude stocks rose by 6.8 million barrels last week, more than three times above analysts' expectations, at a time of year when consumption is seasonally weak.
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Demand is not expected to grow, either. In its latest monthly report, the Organization of the Petroleum Exporting Countries kept its main forecasts for oil consumption unchanged since last month. It estimates global crude demand at 89.7 million barrels a day in 2013.
Brent, the benchmark for international crudes, rose USD 2.45, or 2.3 per cent, to USD 110.72 a barrel on the ICE Futures exchange in London.
In other energy futures trading on Nymex:
Natural gas surged 8 cents to USD 3.76 per 1,000 cubic feet.
Wholesale gasoline jumped 8 cents to USD 2.70 per gallon.
Heating oil added 5 cents to USD 3.07 per gallon.