The price of oil extended gains to around $103 a barrel Wednesday, driven by severe winter weather in the U.S. and supply concerns.
By early afternoon in Europe, benchmark U.S. crude for March delivery was up 59 cents to $103.02 a barrel in electronic trading on the New York Mercantile Exchange, having surged $2.13 on Tuesday. The more heavily traded April contract was up 43 cents at $102.53 a barrel.
The last time the price of oil was above $103 was in October.
Severely cold weather and snowstorms in the eastern region in the U.S. have boosted energy prices. The National Weather Service said more snow is ahead for residents of northern New England, one day after a storm dumped about a foot on many communities.
One half of U.S. households use natural gas as their primary heating fuel and about a quarter of households in the Northeast U.S. rely on heating oil for space heating, according to the Energy Information Administration.
Investors will also be monitoring fresh information on U.S. stockpiles of crude and refined products.
Data for the week ending Feb. 14 is expected to show a build of 1.9 million barrels in crude oil stocks and a draw of 1.3 million barrels in gasoline stocks, according to a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos. Distillate stocks, which include diesel and heating fuels, are seen falling 2 million barrels.
The industry-funded American Petroleum Institute will release its report on oil stocks later Wednesday, while the report from the EIA — the market benchmark — will be out on Wednesday.
Meanwhile, expectations for an increase in oil supplies were dampened after Iran rejected a key demand of six world powers in their latest round of talks in Vienna aiming to finalize a deal to control Tehran's nuclear program. Iran, a major oil producer, will be able to export more crude if the talks lead to reduced sanctions.
Protests in Venezuela, one of the top five crude suppliers to the U.S., and snags in oil production in Libya and South Sudan also helped support prices.
In other markets, Brent crude, a benchmark for international oils, edged down 11 cents to $110.35 a barrel on the ICE Futures exchange in London.
On the Nymex:
— Wholesale gasoline slipped 0.32 cent to $2.9975 a gallon.
— Heating oil was down 0.45 cent to $3.0497 a gallon.
— Natural gas gained 38.2 cents to $5.933 per 1,000 cubic feet.