Fears over US oil supplies sparked the recent price surge

On Thursday, oil prices rose after news that US petrol and fuel oil stocks were more deeply depleted than expected.

This overshadowed a new supply offer from oil producers' cartel Opec. In London, a barrel of Brent crude fell to $55.06 from Thursday's high of $56.15.

In the US, crude oil futures slipped back to $56.32 from Thursday's $57.60.

How high can it go?

But analyst's do not think the oil rise is over. "We could see it at $70 some time this year," Rob Laughlin, an analyst at Man Financial, a hedge fund group, told the BBC's Today programme.

But he said the oil price was volatile and it would not be a linear progression. "Summer gasoline (petrol) demand will outstrip supply," he said.

"The market is still searching for where the top might be, I believe the market will try for $59 a barrel," Tony Nunan at Mitsubishi in Tokyo told Reuters.

"Traditionally, between now and May, there is a pre-season gasoline peak before the (US) driving season starts."

Boosting production

Opec's president said on Thursday that if prices continued to rise the cartel may hold talks next week to consider pumping even more, bringing forward discussions that were previously due to begin in April.

Earlier in the week, Opec said it would up production by 500,000 barrels to produce 27.5 million barrels a day.

Mr Laughlin said there were a lot of speculators in the oil market, adding: "It is volatile because people are using the markets more and more to hedge their exposure (to the oil price)."