Oil futures rose Wednesday after Iran issued a warning over talks about its nuclear program that are scheduled for later this month.
Prices also got a boost from expectations central banks around the world could enact further stimulus measures.
Light, sweet crude for July delivery settled 73 cents, or 0.9%, higher at $85.02 a barrel on the New York Mercantile Exchange. It was the third-straight session of gains. Brent crude on the ICE futures exchange settled up $1.80, or 1.8%, to $100.64 a barrel.
Crude rallied after Iran warned the European Union that delays in holding preparatory meetings ahead of talks in Moscow could jeopardize the talks' success. The warning was reported by state news agency IRNA.
The report shifted the oil market's attention back to Iran. Tensions over the country's nuclear program helped send prices as high as $110 a barrel earlier this year on fears of a supply disruption or military conflict. Iran is the second-largest crude producer in the Organization of the Petroleum Exporting Countries, behind Saudi Arabia.
Prices have since fallen toward $80 a barrel over the last month in large part because of Iran's willingness to negotiate, though discussions so far haven't proven conclusive.
"Iran's got such a track record of dishonesty and evasion, I have a difficult time seeing the whole Iran situation resolving itself smoothly," said Peter Donovan, vice president of Vantage Trading in New York.
Crude prices also got a boost Wednesday from expectations central bankers in the U.S. and Europe could enact another round of monetary stimulus. The head of the European Central Bank said markets are underestimating political leaders' commitment to addressing the euro crisis.
"Remember, the news is so bad [in Europe] that [with] any kind of stability, it's an up move" for crude, said Jeffrey Grossman, president of BRG Brokerage in New York.
In the U.S., the president of the Atlanta Federal Reserve Bank said Wednesday additional stimulus "needs to be considered."
The comments helped weaken the dollar versus the euro, which tends to boost the price of oil by making the dollar-denominated commodity more expensive for holders of other currencies. The euro was recently 0.8% higher at $1.25486.
Market participants largely looked past a report on U.S. oil inventories that showed stockpiles of crude were reduced at a lower-than-expected rate. Crude inventories last week fell 100,000 barrels, according to the Energy Information Administration, compared with analysts' forecast of a 500,000-barrel drop. Market participants watch the EIA's weekly report to gauge broader supply and demand for crude and fuels.
Gasoline stockpiles rose 3.3 million barrels, as supply outpaced demand. Stocks of distillates, including heating oil and diesel, rose 2.3 million barrels.
Analysts expected gasoline inventories to rise just 400,000 barrels, while distillate stocks were seen climbing 200,000 barrels.
Front-month July reformulated gasoline blendstock, or RBOB, settled 0.56 cents, or 0.2%, higher at $2.6903 a gallon. July heating oil settled 3.81 cents, or 1.4%, higher at $2.6717 a gallon.