US stocks turned positive as reassuring same-store sales forecast from retailer Target pushed consumer stocks higher, with the S&P 500 index rising more than 0.5 percent, dragging other risk assets like oil with it on hopes that good corporate results reflected improved economic conditions.

US crude oil futures dipped 27 cents to $75.50 a barrel by 1:39 p.m. EDT (1739 GMT), having earlier dropped to $73.83, the lowest price since July 7.

ICE Brent fell 39 cents to $76.54, having flipped into its biggest premium to the US benchmark in about two months on Tuesday. That premium narrowed about 15 cents to 65 cents as US crude oil stockpiles began to ebb.

"You had a pop in equities and that helped crude bounce off its low," said Richard Ilczyszyn, senior market strategist at Lind-Waldock in Chicago.

Crude slumped early after data from the US Energy Information Administration showed combined inventories of crude and refined products, excluding the Strategic Petroleum Reserve, reached 1.130 billion barrels last week, topping the 1.127 billion barrels struck in Sept. 1990. On a monthly basis, inventories peaked at 1.37 billion barrels in 1980. EIA VS API The EIA data showed a 818,000 barrel drop in US crude stocks, roughly in line with analysts' forecast for a 1 million barrel drop.

But that contrasted with Tuesday's report from the industry group the American Petroleum Institute, which said crude oil stocks rose 5.9 million barrels last week.

"The bearish expectations got out sized on the API report, and the equity-oil correlation remains intact, as the same sentiment that raises and dashes expectations for the global economy produces the same price effects for now," said John Kilduff, partner at Again Capital LLC in New York.

Oil prices have been stuck in a $65 to $85 trading range for about the last 12 months as increases in energy demand in emerging markets has been insufficient to drain ample supplies in other areas in the world.

Crude oil stocks at Cushing in Oklahoma, the delivery point of US crude fell 687,000 barrels to 37.0 million barrels, but still near recent high levels.

The high inventories at Cushing helped push North Sea benchmark Brent crude prices to a premium to US crude. Many investors put their money on moves of the spread between these crude oil contracts.

The premium of Brent has been around a two-month high since Tuesday. In the week to Aug. 6, crude oil supplies at Cushing stood at 37.7 million barrels in the week to Aug. 6, just shy of a record 37.9 million barrels in mid-May.

Also helping keep Brent at a premium to US crude was news Royal Dutch Shell declared force majeure on its Nigerian Bonny Light oil stream after a rise in sabotage on its pipelines cut output by up to 100,000 barrels per day.