NEW YORK (AP) -- The price of oil is higher Wednesday after the Federal Reserve made another big move to stimulate the slow-growing U.S. economy.

The Fed said it will spend $45 billion a month to sustain an aggressive drive to keep long-term interest rates low. It also set a goal of keeping a key short-term rate near zero until unemployment drops below 6.5 percent. The central bank has launched three rounds of bond purchases since the financial crisis hit. The latest replaces a similar plan that was about to expire.

Stimulus measures generally weaken the dollar, which tends to direct more investors into buying commodities.

Benchmark crude rose $1.14 to $86.93 a barrel in New York.

Before the Fed statement was released Wednesday afternoon, oil was moderately higher but muted by a big increase in the nation's gasoline supply. The government said gasoline supplies jumped twice as much as analysts anticipated last week. That's a sign of weak demand.

Prices at the pump fell to $3.31 a gallon, about 4 cents higher than this day a year ago.

Brent crude, used to price international varieties of oil, rose $1.44 to $108.13 on the ICE Futures exchange in London.

Other futures on the New York Mercantile Exchange:

  • Heating oil rose 5 cents to $2.98 a gallon
  • Natural gas fell 4 cents to $3.37 per 1,000 cubic feet.
  • Wholesale gasoline rose 4 cents to $2.65 a gallon.

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