Benchmark crude rose $2.37, or 2.4 percent, to end the day at $100.14 per barrel in New York. Brent crude, which is used to price foreign oil imported by some US refineries, rose $2 to finish at $109.08 a barrel in London.

Rumors swirled during the day about what the Federal Reserve might do to further stimulate the economy.

The Fed, which met Tuesday, left open the possibility for new steps to stimulate the economy next year if needed, but said the nation's economy appeared to be slowly recovering..

The Organization of Petroleum Exporting Countries will meet Wednesday in Europe to decide how much oil to bring to the market. OPEC trimmed its forecast for global oil demand in 2012. But at 88.9 million barrels per day, OPEC's outlook still puts world demand at a record high next year.

On Tuesday the government said that US consumers' retail spending rose in November for the sixth straight month. The US economy is driven by consumer spending, and more spending points to stronger demand for oil. A separate government report said that US businesses built up their stockpiles in October. That's another encouraging sign for the economy, suggesting growing business confidence.

Still, a private survey showed that Americans continue to cut back on gasoline purchases. MasterCard SpendingPulse reported Tuesday that the four-week average for US retail gasoline demand fell by 4.2 percent year-over-year. That's the 38th week in a row that gasoline demand fell.

In other energy trading, heating oil rose 3.27 cents to finish at $2.9288 per gallon, and gasoline futures increased by 6.18 cents to end at $2.6254 per gallon. Natural gas rose 2.5 cents to finish the day at $3.279 per 1,000 cubic feet.