NEW YORK (CNN/Money) - A dip in heating oil supplies drove oil prices to settle above $53 a barrel Wednesday, despite the fact that a government report showed crude inventories rose.

As fuel prices soared across the board, the April gasoline contract ended the session near an all-time high.

Light crude for April delivery rose $1.37 to settle at $53.05 a barrel on the New York Mercantile Exchange, a four-month high, while London Brent gained 84 cents to $50.95.

Gasoline futures for April delivery settled up 8.11 cents at $1.4838 a gallon on the New York Mercantile Exchange, which according to the exchange was near the contract's record high.

Heating oil supplies fell by 1.8 million barrels to 110 million barrels, or 3 percent below year-ago levels, according to the Energy Information Administration's inventory report for the week ended Feb. 25.

Freezing weather in the U.S. has boosted heating oil demand; and private forecaster Meteorlogix predicted Northwest Europe would continue to experience below-normal temperatures for the next 10 days.

"The numbers are mildly bearish. The build in crude is larger than expected. The build in gasoline is as expected although some expected a draw. Heating oil is less (than expected). But the market will disregard it after 15 minutes," said Ed Silliere, an analyst at Energy Merchant.

Inventories of crude stocks and gasoline remained comfortably above year-ago levels.

Commercial crude stocks rose 2.4 million barrels to 299.4 million barrels, while the supply of gasoline grew by one million barrels to 224.5 million barrels.

Gasoline prices surged even after the EIA said inventories rose 1.0 million barrels in the week ended Feb. 25 to 224.5 million barrels, bringing them more than 20 million barrels higher than a year ago.

The news eased market concerns for a spring supply crunch, but did little to cool red-hot prices.

"Demand growth has become so strong that these higher supply levels don't represent the same daily demand coverage they used to," Doug MacIntyre, an EIA analyst, told Reuters. "SUVs are making up a bigger percentage of the fleet and the average American tends to drive more miles."

Gasoline supplies have amassed a nine percent surplus over last year, bringing them to the highest level since 1999 as extraordinary amounts of imports arrived to the nation's shores last month, Reuters reported.

"Our imports of gasoline averaged close to 1.0 million barrels per day in the last four weeks, which is very high for February," MacIntyre told Reuters.

"Europe continues to become more and more diesel-focused in terms of their transportation, which may mean more surplus gasoline for them to export," he said.

-- from staff and wire reports