Analysts say that U.S. shale has been the largest single factor affecting the global energy business in the past decade and the shale boom played a major part in a historic price collapse in 2014.
U.S. West Texas Intermediate (WTI) crude futures were at $63.44 a barrel, 0.8 percent above their last settlement.
Last year, most oil prices have recovered from trading below the $40 level due to the growing market hopes of the OPEC extending the deals again with oil prices touching near above the $50 per barrel price level if not for the sudden rise in US crude inventories that offset the gains of crude oil prices.
Oil briefly topped $70 a barrel in London for the first time in three years, as crude markets continued an nearly unblemished run of gains for 2018.
"The inventory overhang has largely been exhausted", Energy Aspects Ltd.'s chief oil market analyst, Amrita Sen, said in a report.More news: King supports president's signing of act to keep opioids out of US
The national average retail regular gasoline price increased to 2.485 USA dollars per gallon on January 3, 0.013 dollar above last week's price and 0.154 dollar more than a year ago.
"Led by USA production, particularly in the Permian Basin, and new oil sands projects in Canada, non-OPEC production is forecast to continue growing through the end of 2019", EIA acting Administrator John Conti said in a statement.
WTI is still in the February contract, while Brent moved into March. The increase was driven by Lower 48 onshore production (especially in the Permian Basin area) with an estimated increase of almost 330,000 b/d from 2016 to 2017. Prices have also been supported by concerns that supply disruptions could stem from rising political tensions in Opec members Iran and Venezuela.
US crude inventories fell 4.9 million barrels last week, the EIA said yesterday, more than the 3.9-million decline forecast.
While chartists may point to bullish indications that the oil price has further room to climb, it isn't likely to stay there as experts agree that US$70/barrel and above is unsustainable as that is comfortably above the cost of production for shale oil producers. His comments boosted prices, which rebounded from earlier decline, though the market has not hit the heights it touched on Thursday, when Brent crude topped $70 a barrel for the first time since December 2014.More news: Government willing to hand-hold young entrepreneurs, says PM Modi
The rise in price is said to constitute a good omen for the nation's 2018 budget which was based on $45 per barrel and 2.3 million daily oil output.
On Friday, prices were also lower on data from China showing a fall in monthly crude imports. Oil production slid by 290,000 barrels a day to 9.49 million a day.
"So while you have upward pressure on the front, you have downward pressure on the long term price, which is creating a rotation on the oil forward curve.called backwardation; while we expect oil prices to remain flat and maybe slightly down here, the investment return we think will be significant, really being driven by the shape of the forward curve".
Reuters reports that Saudi Arabia doesn't want oil prices to grow too fast.More news: Hundreds protest in Europe and USA in solidarity with Iranian uprising