In the most recent week the EIA reported oil production increased only 3,000 bbls/day, to 9.422mm bbls. This was almost no change, after increasing 45,000bbls/day each of the previous three weeks. Earlier today Bloomberg in a screaming headline, “North American Railroads Caught by Speed of Crude-Oil Collapse” reported rail shipments of petroleum products were down 2.8% for the last 4 week period.
On the surface it may sound like a case for declining oil production is building. However, declining petroleum products by rail is not the same thing as crude shipments, and rail shipment activity does not account for growth in pipelines, the preferred way to ship crude due to lower cost.
As to the flat crude production last week, these numbers bounce around a lot and it is not unusual to have down weeks within a solid uptrend of weekly crude production. The forecasts for a slowdown in crude production after mid-year by most industry observers appears still intact.