The EIA also forecast that US output will average 10.6 million bpd this year, enough to continue surpassing Saudi Arabian output.
Brent crude, the global oil benchmark, rose 0.1 percent to $66.93 a barrel on London's ICE Futures exchange.
Futures fell as much as 1 percent in NY after Department of Energy data yesterday showed USA crude production jumped to a record 10.25 million barrels a day last week.
US crude oil production exploded to 10.25 million barrels a day last week, and virtually every forecast is for that number to remain at or above 10 million for most of the year.
Crude volatility continued higher, with the Cboe/Nymex Oil Volatility Index rising 6.2% on Tuesday after its biggest one-day gain since December at the start of this week.
Product inventories also increased, with gasoline up 3.4 million barrels to 245.5 million, and distillates up 3.9 million barrels to 141.8 million, according to the administration.
The U.S. also made it once into China's top ten suppliers list a year ago - in October - when it was ninth in terms of crude oil sales to China.
That was lower than the increase of roughly 3 million barrels analysts anticipated in a pair of surveys.
On the flipside, U.S. production continues to notch new records and the narrative of higher Non-Opec output may seep into markets sooner rather than later and keep a lid on oil prices.
Russian Federation surpassed Saudi Arabia as China's largest source of foreign crude oil in 2016, exporting 1.2 million b/d to China in 2017 compared with Saudi Arabia's 1.0 million b/d.
The price of USA crude turned negative and was down 1.3% at $62.59 per barrel. According to the EIA, 56 percent of China's crude oil imports came from OPEC members previous year, compared to a peak of 67 percent in 2012.
"The market is strongly reacting to the higher-than-expected surge in USA oil production, which has depressed investor sentiment", Kim Kwangrae, a commodities analyst at Samsung Futures, said by phone from Seoul.
Now investors are expecting the publication of data from the U.S. Energy Department.
"The US record production - that's the nail in the coffin", David Lennox, resource analyst at Fat Prophets, said.
The amount of crude processed by refineries increased 784,000 b/d to 16.797 million b/d, raising the utilization rate by 4.4 percentage points to 92.5% of capacity.