U.S. crude oil rose on Wednesday as a fresh bout of freezing weather boosted heating oil demand, while Brent climbed higher on concerns that political tensions in Africa and Venezuela could squeeze global supplies.
An unusually cold winter in North America has drawn heating oil inventories down to record lows. Weekly data due on Thursday is expected to show a 1.8 million barrel drop in U.S. distillates stocks, like heating oil, according to a Reuters poll. That sent natural gas on a tear, which closed on the NYMEX at its highest level in five years above $6 per mmBtu.
Global supply concerns persisted as output from Libya has yet to recover, and political protests in Venezuela turned violent. The battered U.S. dollar, which fell to its lowest price this year against a basket of currencies, also gave a boost to crude oil and commodities priced in the dollar.
U.S. crude rose 88 cents to settle at $103.31, cents shy of its highest since Oct 10. The contract expires on Thursday. Brent crude rose 20 cents to $110 after settling on Tuesday at its highest level this year.
Oil held gains after minutes from the Federal Reserve meeting showed some policymakers questioned the central bank's efforts to taper.
Traders awaited the American Petroleum Institute's weekly petroleum stocks report to be released later Wednesday at 4:30 p.m. EST (2130 GMT), and the Energy Information Administration's report due on Thursday at 11 a.m. EST.
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