By Myra P. Saefong and William L. Watts, MarketWatch

SAN FRANCISCO (MarketWatch) — Oil futures reclaimed the $100-a-barrel level on Wednesday, after Chinese data showed record oil imports for January and key oil producers raised their forecast on global demand growth for the year.

Prices have pulled back from the session’s high, however, after a weekly U.S. government report also released Wednesday revealed a bigger-than-expected rise in crude supplies.
March crude oil CLH4 +0.37%  rose 82 cents, or 0.8%, to $100.76 a barrel on the New

Oil price increase graph

 York Mercantile Exchange, erasing the contract’s 12-cent pullback Tuesday. Prices, which had been trading up at around $101.18, pared their gains immediately after the U.S. supply reported, bounced back, then eased again.

There were plenty of traders willing to short the psychological $100 level, but once the APIs were released after Tuesday’s close, the spot price began to grind higher, said Tyler Richey, an analyst for the 7:00’s Report, which offers daily markets commentary.

“Now, we are seeing the market react in a confused manner as futures were in the process of breaking out to the upside pre-EIA (but for the wrong reasons: short covering), however the fundamentals from the EIA were bearish,” he said. The level to watch now is the morning high and “if that is broken we could see a continuation of the morning rally.” FactSet data show the morning high at $101.38.

The U.S. Energy Information Administration said crude stockpiles rose 3.3 million barrels for the week ended Feb. 7. Analysts polled by Platts were looking for a climb of 2.5 million barrels.

Gasoline supplies fell unexpectedly by 1.9 million barrels, while distillate stockpiles declined by 700,000 barrels, the EIA said. Gasoline stockpiles were expected to be unchanged while distillate supplies were seen down 2.5 million barrels, according to the Platts poll.

Gas and diesel prices at the pumpAgainst that backdrop, March gasoline RBH4 +0.55%  led the percentage gains among the petroleum products, adding nearly 4 cents, or 1.4%, to $2.79 a gallon, while March heating oil HOH4 -0.54%  was little changed at $3.03 a gallon.

Late Tuesday, the American Petroleum Institute said crude-oil supplies rose 2.1 million barrels, a bit less than the market expected.

Crude supplies at Cushing, Okla., the delivery hub for Nymex futures, showed a draw of 2.6 million barrels, which was not surprising, said John Macaluso, research analyst at Tyche Capital Advisors. Since the West Texas Intermediate contract is priced from Cushing, “we are not surprised to see crude higher.”

But “prices above the $100 level, we feel, will have a hard time sustaining those levels over the weeks to come,” he said. “One of the factors controlling the choppy price direction for crude oil over the last dew weeks is the Brent-WTI spread which has contracted quite a bit today.”

Brent crude oil for March delivery UK:LCOH4 +0.07%  added 65 cents, or 0.6%, to $109.32 a barrel on ICE Futures.

OPEC report, China data

Organization of the Petroleum Exporting Countries, meanwhile, said in a monthly report that world oil demand would grow at a slightly faster pace than previously expected in 2014. They now see growth of roughly 1.09 million barrels a day, up about 45,000 barrels per day from a previous forecast with demand see at 90.98 million barrels per day for the year. See the full OPEC report.

Earlier, crude futures added to gains after China’s customs service said the nation imported a record 28.16 million metric tons of oil in January, with The Wall Street Journal reporting the gain translated into a 5.2% rise from December.

The rise in Chinese purchases came against larger-than-expected gains for both exports and imports overall.

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“Some of that growth is attributable to stockpiling of reserves, but the demand cannot be ignored,” said analysts at the Kilduff Report. “The game plan that every oil producing country has to sell more barrels to China may not be off the mark, after all. It is a very supportive development for the oil market, and we would not be so quick to rationalize it away.”

In a note, however, Phil Flynn, senior market analyst at Price Futures Group in Chicago, said that while “the bull needs to be fed with news every day and overnight from China is providing it…The problem is that it might be bull.”

The report had traders “crying foul,” with many believing that Chinese companies are over-invoicing in order to use cash to invest in hot sectors, he said.

Back on Nymex, March natural gas NGH14 +0.37%  was up 11 cents, or 2.2%, at $4.93 per million British thermal units, pulling back from a high of more than $5 in electronic trading. On Tuesday, prices saw a 5.4% surge as cold weather gripped parts of the U.S