NEW YORK, Jan. 17 (Xinhuanet) -- Oil prices closed to a three-month high of 66.31 dollars a barrel on the New York Mercantile Exchange Tuesday on concerns about Iran's nuclear ambitions and reduced Nigerian production.

    New York's main oil contract, light sweet crude for delivery in February surged 2.39 dollars to close at 66.31 dollars, the highest finish since September 29.

    In London, the price of Brent North Sea crude for March delivery soared 1.72 dollars to close at 64.90 dollars a barrel, also its highest point in more than three months.

    The rally in crude prices spread to natural gas and heating oil despite warm weather, which typically drives down prices on those fuels. Natural gas, which is used to generate heat and electricity, picked up 38 cents to 9.17 dollars per million British thermal units. Heating oil gained 7 cents to 1.79 dollars a gallon and unleaded gasoline added 9 cents to 1.82 dollars a gallon.

    Geopolitical tensions are spooking the markets, observers said, even as mild temperatures have boosted supplies and production in the Gulf of Mexico has slowly recovered after hurricanes Rita and Katrina. Geopolitical concerns and an inflow of money have boosted oil prices nearly seven percent since the start of the year.

    Russia and China joined the U.S. and Europe Monday in asking the U.N. Security Council to step into the fray with Iran, which announced last week that it is restarting a nuclear research program after a two-year suspension. Iran, the second-biggest oil producer in the Organization of Petroleum Exporting Countries, exports some 4.2 million bpd.

    Traders are worried about economic sanctions, which the U.N. Security Council could impose, will drastically cut world oil supplies and drive up prices.

    Attacks on oil supplies in Nigeria, the fifth-largest supplier of U.S. oil imports, were also roiling the energy markets. On Monday, Royal Dutch Shell said its Benisede oil platform was damaged in a rebel raid, leading to the curtailment of about 100,000 barrels of daily production.

    Meanwhile, the International Energy Agency on Tuesday reduced its forecast for non-OPEC supply growth by 100,000 barrels per day, but left its forecast for world oil demand this year unchanged at 85.1 million barrels a day, up more than 1.8 million barrels a day against last year. Enditem