Oil rose below $71 a barrel on Tuesday, ending a three-day losing streak ahead of U.S. data expected to show a fall in gasoline stocks, with weaker-than-expected Chinese economic data acting as a drag.

China reported below-forecast growth in factory output and investment on Tuesday, underlining why senior officials keep reminding markets that recovery in the world's third-largest economy is not yet on solid ground.

But the slowing growth in factory output didn't seem to dampen the country's demand for crude oil imports, which jumped 42 percent on year in July to a record 4.62 million barrels per day as refiners boosted exports and cashed in on retail prices hikes in June.

Other data showed exports perked up in July, when compared to June, and retail sales passed expectations with a speedy 15.2 percent gain.

U.S. light crude for September delivery rose 46 cents to $71.06 a barrel by 2:36 a.m. EDT, having settled down 33 cents on Monday at $70.60 a barrel as it tracked Wall Street losses.

London Brent crude rose 34 cents to $73.84 a barrel.

The Chinese data is slightly disappointing but the focus remains on a recovery in Western oil demand. The U.S. is the world's largest oil consumer and tomorrow's oil data will be pretty important, said Toby Hassall, an analyst with CWA Global Markets in Australia.

A Reuters poll of analysts called a steep 1.5 million barrels drawdown in U.S. gasoline stocks in the week ended August 7, deeper than the previous week's 200,000 barrels fall.

But the poll also predicted a bearish 800,000-barrels rise in crude stocks on higher imports and lower refinery utilization.

The American Petroleum Institute will release a first set of data at 4:30 p.m. EDT, to be followed on Wednesday by data from the Energy Information Administration (EIA).

Oil has more than doubled from this winter's low $30s but high inventories worldwide have kept prices in check as they suggest still weak demand.

But a slightly brighter economic outlook may prompt the EIA to again raise its world oil demand forecasts when it releases its August report at 1600 GMT, adding to the past two monthly reports' higher forecasts.

In its July outlook, the EIA raised its 2009 global oil demand projection to 83.85 million barrels per day from the previous forecast of 83.68 million bpd -- still well below 2008 levels of 85.41 million bpd.

OPEC will also release its monthly oil report on Tuesday, followed by the International Energy Agency on Wednesday.

Traders will also watch the policy-setting Federal Open Market Committee (FOMC) meeting on Tuesday and Wednesday for any action regarding interest rates.

The worst U.S. recession since the Great Depression will probably end in the third quarter, but uncertainty exists over the speed and duration of the economic recovery, according to the most recent survey of private economists.

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