Oil declines away from 2015 highs

Oil prices fell on Friday, dropping away from highs last seen in 2015, as soaring production in the US undermined the 10% rally from lows hit in December that was driven by tightening supply and political tensions in OPEC member Iran.

US West Texas Intermediate (WTI) crude futures were at $61.92 a barrel at 0313 GMT, 9 cents below their last close though still near to the $62.21 high reached the previous day that was the most since May 2015.

Brent crude futures were at $67.96 a barrel, 11 cents below their last settlement, but still not far off the $68.27 high from the day before, also the highest since May 2015.

Traders said political tensions in Iran, third-largest producer in the OPEC, had pushed prices higher.

"The protests in Iran add more fuel to the already bullish oil market mood," said Norbert Ruecker, head of commodity research at Swiss bank Julius Baer.

Oil prices have received general support by production cuts led by OPEC and by Russia, which started in January last year and are set to last through 2018, as well as by strong economic growth and financial markets.

This has helped tighten markets. US commercial crude inventories fell by 7.4 million barrels in the week to Decemer 29, to 424.46 million barrels, according to data from the Energy Information Administration (EIA).

That is down 20% from their historic peaks last March and close to the five-year average of 420 million barrels.

Yet given Iran's oil production has not been affected by the unrest, and that U.S. production will likely break through 10 million barrels per day (bpd) soon, a level so far only reached by Saudi Arabia and Russia, doubts are emerging whether the bull-run can last.