There are indications that the United States oil production has witnessed a drop in recent times, thus contributing leap in prices.
In its report, â€œThis Week in Petroleumâ€, the United States-based Energy Information Administration indicated a fall.
The government agency reported that crude oil production fell marginally by 24,000 bpd (barrels per day) to 9.0 MMbpd (million barrels per day) for the week ending April 15 compared to the previous week.
It disclosed that US crude oil production fell for the 12th consecutive week. This production level is 5per cent less than in the corresponding period last year.
The agency said monthly US crude oil production peaked at 9.7 MMbpd in April 2015. In contrast, US crude oil production tested the low it set on October 17, 2014, during the week ending April 15, 2016.
It maintained that weekly US crude oil production has fallen by 7.5per cent from the peak level of 9.7 MMbpd.
The agency noted that US crude oil production has fallen sharply in the lower 48 states due to lower oil prices, and crude oil prices have fallen due to oversupply.
It disclosed that lower crude oil prices affect US shale oil producers like Laredo Petroleum (LPI), Ultra Petroleum (UPL), and Whiting Petroleum (WLL) because they have higher break-even costs and production costs compared to oil producers in the Middle East and Russia.
The agency said for more information on US energy companiesâ€™ financial woes, readers should read North American Oil and Gas Producersâ€™ Debt Rose in 2015 and Crude Oilâ€™s Total Cost of Production Impacts Major Oil Producers.
It said weekly US crude oil imports rose by 247,000 bpd to 8.2 MMbpd for the week ending April 15, 2016, compared with the previous week.
â€œThe rise in imports adds to the crude oil inventory. For more about the US crude oil inventory, read the previous part of this series. For more on crude oil prices, read the first part of this series.â€œMeanwhile, the US crude oil refinery demand rose by 163,000 bpd to 16.1 MMbpd for the same period.Â Crude oil refinery demand is 1.2per cent less than in the same period in 2015. The EIA forecasts that the US crude oil production could fall by 0.83 MMbpd to 8.6 MMbpd in 2016 compared to 2015.â€œThe expectation of slowing US crude oil production could support crude oil prices and oil producers like Denbury Resources (DNR) and Synergy Resources (SYRG),â€ it added.
-Â Â Â Â Â Â Â Â Â Gordon Kristopher, Business