Crude oil increased in New York after a report showed manufacturing in China expanded in August 2009, easing concern of an economic slump in China, according to Bloomberg.

Crude oil for October 2009 delivery gained as much as $0.34, or 0.5%, to $70.30 a barrel in after-hours electronic trading on the New York Mercantile Exchange.

It was trading at $70.17 a barrel at 12.27pm Singapore time. Futures earlier declined as much as 0.6% to $69.55 a barrel.

An Energy Department report on 2 September is expected to show that US crude oil stockpiles dropped in the week beginning 24 August, a Bloomberg News survey showed.

Supplies likely dropped 500,000 barrels from 343.8 million the previous week, as per the median of eight analyst responses in the survey.

The stockpiles of gasoline probably dropped 1.05 million barrels. Supplies of distillate fuel, including heating oil and diesel, probably rose 675,000 barrels, according to the survey. Inventories are near their highest since 1983.