U.S. crude oil futures climbed above $100 a barrel on Tuesday, approaching a recent record high of $101.32 reached last February 20, the highest since trading began 25 years ago.
Earlier on Tuesday, U.S. reports showed signals of increasing inflation. As a result the dollar fell against the euro to reach a record low, prompting traders to invest in commodities as a hedge against inflation.
The Conference Board's index of consumer confidence dropped to 75.0 in February from 87.3 in the previous month falling to its lowest level in five years.. Separately, the U.S. Labor Department reported producer prices rose 1.0 percent and expenses -excluding food and energy - climbed 0.4 percent.
In the same way, home prices tumbled the most on record as the S&P Case-Shiller index of home prices fell 9.1 percent in December. The index measures prices in 20 different metropolitan areas in the United States.
Along with the reports, the dollar also fell against the Japanese yen.
Crude Oil futures for April climbed $1.65, or 1.66 percent to $100.88 a barrel at 3:23 p.m. on the New York Mercantile Exchange. In London Brent crude futures for April rose $1.40, or 1.41 percent to $100.88 a barrel on the ICE Futures Exchange.
Investors are also considering the next resolution of the Organization of Petroleum Exporting Countries which provides 40 percent of world's crude output. It is expected that OPEC will reduce its output by 200,000 barrels of crude oil a day, meaning a drop of 0.6 percent, according to PetroLogistics Ltd.
OPEC has a meeting scheduled for March 5 in Vienna to discuss crude supplies.