Gold and Silver prices continued to rally Wednesday as uncertainly over energy prices made precious metals an attractive place to park money.
Gold and silver had sagged earlier this year as investors started feeling more confident about moving money into stocks. But rising oil prices and political uncertainty in the Middle East have brought precious metals back into favor.
"People get more nervous about the economy _ if people don't want to buy oil they'll pile into gold," said Edward Meir, senior commodities analyst at MF Global in New York.
The jump in oil prices won't affect all commodities equally, Meir said. While it can boost gold, it can undermine the value of industrial metals like copper and palladium that are tied to manufacturing. Grains and other foodstuffs could also fall if economic growth slows.
Gold for April delivery rose $6.50 to settle at $1,437.70. Silver for May delivery rose 40.8 cents to settle at $34.835 an ounce.
In other metals contracts, copper fell 1.05 cents to settle at $4.48 a pound. Palladium gained $5.95 at $822.65 an ounce. Platinum rose $14.20 to $1,859.30 an ounce.
Oil prices increased as fighting escalated in Libya and petroleum demand grew in the U.S.
In Libya, forces loyal to Libyan leader Moammar Gadhafi used airstrikes in a battle against protestors for control of a key oil installation in the eastern half of the country. Analysts are concerned that the rebellion will endanger Libya's oil fields, which produce 1.6 million barrels per day. That's only about 2 percent of global demand, but experts say the disruption is putting pressure on world supplies at a time when demand is picking up.
In the U.S., the government reported Wednesday that petroleum demand continues to rise from last year. Oil and gasoline supplies both dropped unexpectedly last week. Meanwhile, the Energy Information Administration reported that oil supplies in the U.S. fell by 400,000 barrels and gasoline inventories dropped by 3.6 million barrels last week.
Benchmark oil for March delivery rose $2.60 cents to settle at $102.23 a barrel on the New York Mercantile Exchange.
In other Nymex trading, heating oil gained 3.42 cents to settle at $3.0577 per gallon, gasoline rose 4.61 cents to settle at $3.0295 per gallon and natural gas lost 5.5 cents to settle at $3.818 per 1,000 cubic feet.
Grains and beans were mixed. In May contracts, wheat gained 1 cent to settle at $8.1125 a bushel, corn lost 14 cents to settle at $7.215 a bushel and soybeans rose 19 cents to settle at $13.9425 a bushel.