NEW YORK (AP) - Oil prices rose Wednesday after the Federal Reserve boosted its outlook for U.S. economic growth.
Benchmark West Texas Intermediate crude added 57 cents to end at $104.12 per barrel in New York. Brent crude, which sets the price of oil imported into the U.S., added 96 cents to finish at $119.12 per barrel in London.
The Fed expects the U.S. economy to grow between 2.4 percent and 2.9 percent in 2012. That's up from a January forecast of 2.2 percent to 2.7 percent growth. The Fed also expects unemployment to drop to between 7.8 percent and 8 percent by the end of the year. The rate is currently 8.2 percent.
Natural gas also rose sharply after Encana, a large Canadian gas producer, said it would cut production. It rose further after the Fed came out with its forecast. Natural gas was up 9.3 cents to finish at $2.068 per 1,000 cubic feet.
Oil prices dipped earlier in the day after the Energy Information Administration reported that U.S. oil supplies increased by 4 million barrels last week. The increase was a surprise following an industry trade group's prediction late Tuesday that supplies had dropped last week. The price of oil tends to fall as more supply becomes available to refineries.
Crude supplies climbed close to a record high in Cushing, Okla., a crucial hub where benchmark crude is delivered. High oil supplies in Cushing have pushed the benchmark price lower than other oil varieties. Cushing supplies are expected to start falling in May when the Seaway Pipeline begins carrying crude oil from Cushing to the Gulf Coast.
The EIA report said petroleum demand fell by 3.2 percent when compared with the same time last year.
At the pump, gasoline prices fell for a ninth day to a national average of $3.84 per gallon, according to AAA, Wright Express and Oil Price Information Service. The price of gasoline has declined by an average of 9.6 cents per gallon since it hit $3.936 per gallon on April 6.
In other energy trading, heating oil rose by 3.16 cents to finish at $3.1611 per gallon and gasoline futures gave up less than a penny to end at $3.1557 per gallon.
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