Oil climbed almost 4 percent Wednesday amid a broad commodities rally, as gasoline pump prices continued to fall across the country.
Benchmark West Texas Intermediate crude for June delivery rose $3.73, or 3.9 percent, to $100.64 per barrel in midday trading on the New York mercantile Exchange.
Crude is still down about 12 percent since April, when a weak dollar and a rash of international crises pushed oil to two-year highs. Oil is priced in dollars and tends to rise as the dollar falls and makes oil cheaper for investors holding foreign currency.
On Wednesday, the dollar again lost ground to foreign currencies, propping up crude and other dollar-based commodities. Metals like gold, silver and copper rose, along with grains, cotton and sugar.
The Energy Information Administration said that oil supplies were flat last week, but investors focused on a drop in supplies at the delivery point for benchmark crude in Cushing, Okla. That gave oil a boost.
Refineries also cranked up production last week, increasing the capacity they used by 1.5 percentage points. That helped keep prices up despite an overall drop in petroleum demand. Wholesale gasoline demand also declined for the eighth straight week, when compared with a year ago, according to the EIA.
On Tuesday MasterCard SpendingPulse's weekly survey of retail gas demand also showed a drop for the eighth straight week.
Meanwhile gas pump prices continued to fall, losing nearly 2 cents on Wednesday for a national average of $3.926 per gallon. A gallon of regular is still 9.3 cents higher than a month ago and $1.067 more than a year ago.
In other Nymex trading for June contracts, heating oil added 6 cents at $2.9075 per gallon and gasoline futures rose 3 cents to $2.9504 per gallon. Natural gas gained 3 cents at $4.280 per 1,000 cubic feet.
In London, Brent crude climbed $2.37, or 2.2 percent, to $112.36 per barrel on the ICE Futures exchange.
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