-While anti-government protests in Iran and the possibility of USA imposing sanctions again on the country has helped the ongoing crude rally to three-year highs, analysts are cautious as further moves are likely to depend on whether US shale production picks up because of the higher prices.
Brent crude futures traded 55 cents lower at $68.71 a barrel at 1253 GMT.
An expected rise in USA oil production C-OUT-T-EIA to above 10 million bpd from 9.5 million bpd now has also weighed.
More immediate price support came overnight from the United states, where crude inventories fell nearly 5 million barrels in the week to January 5, to 419.5 million barrels. EIA's latest Short-Term Energy Outlook (STEO) from earlier this week estimated that US crude oil production averaged 9.3 million bpd in the whole of 2017, and 9.9 million bpd in December alone.
The Paris-based IEA, for its part, said in its latest Oil Market Report from December that "On considering the final component in the balance - non-OPEC production - we see that 2018 might not be quite so happy for OPEC producers".
"EIA estimates that Opec countries cut crude oil production output in 2017, but those cuts were offset by increased production in non-OPEC countries, especially the United States and Canada", John Conti, EIA acting administrator, said in a statement.
Oil slipped in London after briefly climbing above $70 a barrel for the first time in three years as a global surplus recedes.Brent futures declined 0.6 percent, having added 1.8 percent this week in a fourth weekly increase.
The price upturn began in June past year, and now prices are nearing levels from late 2014. These levels of US crude oil output are expected to continue increasing in 2019 to an average of 10.8 million b/d. EIA expects OPEC crude oil production to increase by 0.2 million b/d in 2018 and by an additional 0.3 million b/d in 2019 as it slowly returns to pre-agreement levels. The average production in 2019 will rise 580,000 bpd to 10.85 million bpd, the agency said in its first outlook for next year.
Production from the Permian is expected to be 3.6 million bpd by the end of 2019, an increase of roughly 900,000 bpd from December 2017, and 32 percent of US crude oil production in 2019. The average sale price of gas in 2017 was $2.42/gal.
Liquefied natural gas gross exports are forecast to average 3 bcf per day in 2018, up from 1.9 bcf in 2017. Although more crude oil export infrastructure has been recently built, USA exporters must still use smaller, less-economic vessels or more complex shipping arrangements, which often add to costs.