How can flying high minimize drag and increase fuel efficiency?
Flying higher means less drag because the air is thinner; therefore, you can fly faster at altitude and hence travel farther on less fuel. 

However, flying higher also means less oxygen available to burn your fuel, so available horsepower decreases with altitude. 

There is a special altitude at which these two effects (drag reduction and available power reduction) achieve a crossover point. This is called the critical altitude and it is there where you achieve optimum cruise and best economy.

If you want to fly higher than critical altitude, you will fly slower because the power loss is greater than the drag reduction and you will spend more time in the air.