Oil prices jumped to their highest level in more than three months yesterday, rallying above $51 a barrel as traders focused on the declining value of the dollar, cold weather and the possibility of an OPEC production cut.

But if these factors provided the initial impetus for yesterday's 6 percent run-up, analysts said speculative buying by institutional investors was the force that kept it going.

After climbing as high as $51.40, light sweet crude for March delivery settled at $51.15 a barrel on the New York Mercantile Exchange, an increase of $2.80. The March contract expired yesterday, but April crude also looked strong, settling at $51.42 a barrel.

The higher oil prices triggered widespread selling on Wall Street, but while the Dow Jones industrial average fell more than 100 points, the oil and gas sector performed better than most others. Shares of petroleum giant BP PLC rose 41 cents to $63.61, while those of Anadarko Petroleum Corp. rose 35 cents to $70.60.

Oil is 50 percent more expensive than a year ago and prices for products derived from it are similarly high: unleaded gasoline averages $1.90 per gallon at the pump nationwide, according to the Energy Department.

"The big factor right now is the weak dollar," said Tom Bentz, a broker for BNP Paribas Commodity Futures. Crude oil is denominated in dollars, so the money the Organization of Petroleum Exporting Countries earns for every barrel does not stretch as far as it used to.

Moreover, as the dollar falls against other nations' currencies, it becomes that much less expensive to purchase crude oil in those countries, potentially raising demand.

Cold spells in Europe and the United States also propelled oil futures higher on yesterday.

James Cordier, president of Liberty Trading Group in St. Petersburg, Fla., said crude's latest run-up above $50 could be short-lived, as producers jump on the opportunity to sell their oil at these levels to lock in profits.

Still, well-financed investors appear to be having considerable influence these days. Data published by the Commodity Futures Trading Commission shows that speculators boosted their net long positions in the week ended Feb. 15, while scaling back their short positions. A long position is a bet that futures will rise and a short position is a gamble that prices will fall.

Analysts said U.S. inventories of gasoline and crude were adequate for this time of year, emphasizing that yesterday's rally had more to do with macroeconomics and technical trading than the fundamentals of supply and demand.

Even comments by OPEC's president that the cartel was not likely to cut production next month failed to calm markets.

Heating oil futures rose 9.09 cents to $1.4402 per gallon on Nymex, where gasoline futures surged 4.55 cents to $1.3089 per gallon.

In other Nymex trading, natural gas futures rose 1.95 cents to $6.103 per 1,000 cubic feet.

Adnan Shihab Eldin, acting secretary-general of OPEC, has said the group might cut an additional 1 million barrels a day when it meets in Iran on March 16. But Nigerian and Algerian officials have suggested no major reductions are needed.

The president of OPEC -- also Kuwait's energy minister -- added his voice yesterday to those in the organization against reducing production.

OPEC collectively produces more than a third of the world's crude, and its decisions on raising or lowering output can have a significant impact on prices, especially at a time when global demand remains robust and there's little spare supply capacity. Violence in Iraq and labor unrest in Nigeria also have kept the market on edge.