United States commercial crude oil stocks fell nearly 5-million barrels in the week to January 5, to 419.5-million barrels, or slightly below the five-year average of just more than 420-million barrels, the target for Opec and others involved in output cuts. U.S. West Texas Intermediate (WTI) crude futures fell 14 cents to $63.66.
"Crude oil prices continued to firm through the quarter, driven mainly by persistent demand, declining global inventories, compliance from OPEC and Russian Federation on self-imposed oil production quotas, and extended commitments to those quotas into 2018", Shawn Reynolds Portfolio Manager for VanEck, said in a note.
The U.S. Energy Department expects production will blow through 10 million bpd in the next few months, en route to 11 million bpd by next year, rivaling Russian Federation and Saudi Arabia.Futures contracts show an expectation for prices to pull back by year end, with the December U.S. crude futures contract now trading just above $60 a barrel.
While these seem like muted responses to another remarkable day in trading, other experts were more explicit in stating their misgivings about the high prices: specifically, Stephen Innes, head of trading for Asia/Pacific at Oanda, argued that the fuel market has overheated: "Markets are getting a bit tired, and a healthy correction could be on the cards".
Another factor behind the rise in prices is the devastating hurricanes along the U.S. Gulf Coast that shut down refineries and reduced stockpiles of fuels such as gasoline and diesel.
As a result of e-commerce in London and NY stock exchanges, the world oil prices are falling, Gazeta.ru reports.
Wall Street closed at record highs on Thursday as rising oil prices lifted energy stocks and investors bet on a strong US corporate earnings season.
The RAC signalled pump costs were likely to reflect the march of Brent crude - damaging the economy at a time drivers and businesses could ill afford it.
Most of the production growth, the EIA noted, will be in the Permian Basin.
In the 2010s, shale oil production went into full swing, limiting OPEC's pricing power.
Brent crude oil hit a more than three-year high on Thursday, breaking through the psychologically important $70 a barrel level for the first time since December 2014. Analysts, had expected a much smaller drawdown of 3.89 million barrels in crude oil. By the way, Iran is the OPEC's third-biggest producer of crude oil. Average output next year is forecast to reach 10.85 million barrels per day putting it on par with Saudi Arabia and Russian Federation. However, there were fears that investors would lose confidence in OPEC and prices would plummet if the extension was limited to six months.
Yet despite fears, recent rising oil prices have found support from eight consecutive weeks of USA crude inventory drops.
"People are starting to realize that", Phil Flynn, senior market analyst at Price Futures Group Inc.in Chicago, said by telephone.
Also, the prices of Brent and WTI rose to $69.81 and $64.53 per barrel respectively while the price of Organisation of Petroleum Exporting Countries, OPEC, basket of 14 crudes stood at $67.24 per barrel. China's crude imports in December fell 9 percent month-on-month to 33.7 million tonnes, or 7.97 million bpd, customs data showed.