Crude oil climbed higher Wednesday after the U.S. Federal Reserve indicated there would be no change in its monetary policy.
Light, sweet crude settled at $112.76 a barrel, up 55 cents. After a two-day meeting, Federal Reserve chairman Ben Bernanke said Wednesday that the spike in inflation will be temporary, due to higher oil and gas prices, and that the economy will continue to recover at a moderate pace.
The Fed also said it will keep interest rates near zero. Lower interest rates have helped keep the dollar weak contributing to higher oil prices. Oil, which is priced in dollars, is more attractive to foreign buyers when the dollar is weak.
Crude futures for June delivery fluctuated between $110.71 and $113.40 Wednesday.
Meanwhile, crude futures were also pressured by strong gasoline prices. Front-month gasoline gained 6.22 cents, settling at $3.419 a gallon. Gasoline futures traded between $3.35 and $3.44 a gallon on Wednesday. RBOB gasoline futures ended the day's trading session at their highest in 33 months. The Energy Information Administration (EIA) reported that gasoline stockpiles fell last week for the 10th week in a row, the lowest level since Sept. 2009.
After trading between $4.37 and $4.43, May natural gas lost a penny to settle at $4.377 a gallon Wednesday.
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