Crude prices rose on Wednesday as U.S. gasoline inventories fell sharply last week, exceeding expectations.

The Energy Information Administration said that U.S. crude inventories increased 2.8 million barrels in the week ended April 6, beyond economists' estimates of 2.1 million barrel increase. It was the third straight weekly gain for crude stocks. But the gasoline stocks fell steeply by 4.3 million barrels in an unexpected way. And a big draw was also posted to distillate inventories, down by 4.0 million barrels.

These sharp declines reflected a slowing output from refineries, not a strengthening demand. Instead, gasoline wholesales remained weak.

Other factors kept weighing on the markets. Worries about a slowdown in U.S. economy, renewed concerns about European debt problems and fears of less crude demand from China still posed great pressure on the oil prices.

Besides, after Iran's agreement to resume talks with the West over its nuclear program, crude oil also lost some rising momentum. Crude prices have cooled from last month's high, with both New York benchmark and Brent crude losing about 6 dollars a barrel.

Light, sweet crude for May delivery gained 1.68 dollars, or 1. 66 percent to settle at 102.70 dollars a barrel on the New York Mercantile Exchange. In London, Brent crude for May delivery also rebounded from seven-week low hit on the previous trading day and last traded around 120 dollars a barrel.