Oil Hits Record High and Record Close

NEW YORK (AP) -- Gasoline and oil prices extended their record-setting streaks Wednesday, with gas at the pump reaching a new high of nearly $3.25 and crude surpassing $110 for the first time.

Investors shrugged off an Energy Department report that crude oil and gasoline supplies jumped last week.

The national average price of a gallon of regular gas rose by 1.9 cents overnight to $3.246 a gallon, a new record, according to AAA and the Oil Price Information Service. Pump prices are following crude's recent surge, and could rise as high as $3.75 a gallon this spring, analysts say.

Light, sweet crude for April delivery rose $1.19 to $109.92 a barrel on the New York Mercantile Exchange after earlier rising to a new trading record of $110.20.

The dollar fell to a new low against the euro Wednesday, attracting new buyers to the oil market. Crude futures offer a hedge against a falling dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the dollar is weak. Many analysts believe the dollar's decline is the reason crude futures have surged to new records in 11 of the past 12 sessions, despite the fact that crude supplies have risen 10.2 percent since early January.

Oil prices actually fell after the Energy Department's Energy Information Administration said crude supplies jumped by 6.2 million barrels last week, more than three times the 1.6 million barrel forecast of analysts surveyed by Dow Jones Newswires. But buyers quickly returned to the market.

"I tend to think that every (price) dip looks like a buying opportunity right now," said Linda Rafield, senior oil analyst at Platts, the energy research arm of McGraw-Hill Cos.

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