U.S. shale producer Continental Resources Inc. raised its capital budget and forecast a rise in its crude oil and natural gas output this year, building on a recent recovery in commodity prices from pandemic-led historic lows.

Crude prices have rallied to their highest level in almost a year, sparking optimism among shale producers after a slump in fuel demand. A harsh winter weather gripping some U.S. states has also raised natural gas demand and prices to record levels.

The company, a major producer in the Bakken shale of North Dakota, said it now expects capexs of $1.4 billion in 2021, up from a previous forecast of between $1.2 billion and $1.3 billion.

It expects annual oil production of between 160,000 bbl/d and 165,000 bbl/d this year, compared with 2020 production of 160,505 bbl/d.

Higher spending in the fourth quarter also pushed the company to an adjusted loss of 23 cents per share, much bigger than analysts' average estimate of 8 cents per share, according to Refinitiv IBES data.

Continental also said it acquired 130,000 net acres and about 9,000 boe/d of production in the Powder River Basin for $215 million, adding more oil-weighted assets to its portfolio.

Separately, rival Devon Energy Corp., which completed a merger with WPX Energy last month, also set a higher budget for 2021 and raised its previous production forecast due to better efficiency at its wells in the Delaware Basin.