(Chart 1) EIA Weekly Reports (In Thousands of Barrels)
Month Month End BPD +/- from Previous Month
Sept. 2015 9096 -122,000 BPD
Oct. 2015 9160 +64,000 BPD
Nov. 2015 9202 +42,000 BPD
Dec. 2015 9202 0 BPD
Jan. 2016  9221  +19,000 BPD
Feb. 2016  9102  -119,000 BPD
March 2016  9022  -80,000 BPD
April 2016    
May 2016    
June 2016    
July 2016    
August 2016    
Sept. 2016    

Chart 1 compiles the Month End Barrels Per Day from the Weekly EIA Reports.  The BPD are in thousands of barrels.  Hence, 9096 is 9,096,000 barrels per day.  The weekly reports are compiled by the EIA using a computer model.  The data is not entirely accurate, but is "in the ballpark".  That being said, the Monthly data (see below, Chart 2) is much, much more accurate.  What stands out with the data from Sept. to Dec. is that the EIA reported production increases of 64,000 BPD in Oct., and 42,000 BPD in Nov.  Compare that with the actual large production decline in October of 79,000 BPD on the Monthly report.  I do not believe we will see a monthly decline in production reported on the weekly reports until the Daily Preduction number from the weekly report is nearly equal to or greater than the daily production number from the Monthly report.  That should happen by February. 

My thesis (see the previous two sentences), seems to proving correct.  Now that the monthly and the weekly production data are only off by 60,000 bpd., we are seeing large production declines on the weekly reports.  That being said, the monthly production data will probably be lower then the weekly production data for January, hence the reason production started to decline on the weekly reports in Feb. You gotta love the EIA! They completely over estimated production cuts in the summer of 2015, but it has only taken them 6 months to sort it out!  Additionally, we have seen our first month over month decline in production on the weekly reports since Sept., which is fascinating, since we know from the monthly report that production was actually up 45,000 bpd. in Sept. (see chart below).

The last weekly report in March reported production at 9,022,000 bpd.  We are getting very close to going below 9,000,000 bpd. since late 2014. We should dip below 9,000,000 sometime in the next week or two. 


(Chart 2) EIA Monthly Production
Month Month End BPD +/- BPD from Previous Month
Sept. 2015 9452 +45,000 BPD
Oct. 2015 9377 -75,000 BPD
Nov. 2015 9328 -49,000 BPD
Dec. 2015 9235 -93,000 BPD
Jan. 2016 9179  -56,000 BPD
Feb. 2016    
March 2016    
April 2016    
May 2016    
June 2016    
July 2016    
August 2016    
Sept. 2016    

Chart 2 compiles the BPD from the EIA's Monthly Crude Oil production report.  Production was down again, for the fourth month in a row. 

See this chart to get an idea of just how much producers are planning on cutting in fiscal 2016 (http://bburmeister.com/page13.php).  My guess is that we will see production really plummet in 2016.  It seems most producers plan on cutting around 10%-20%.


(Chart 3) Difference Between the Weekly and Monthly
Month BPD (as reported on the weekly report) BPD (as reported on the monthly report) Diff. Which is higher? Monthly or Weekly
Sept. 2015 9096 9452 353,000 BPD Monthly
Oct. 2015 9160 9377 210,000 BPD Monthly
Nov. 2015 9202 9328 126,000 BPD Monthly
Dec. 2015 9202 9235 33,000 BPD Monthly
Jan. 2016  9221 9179   42,000 BPD  Weekly
Feb. 2016  9102      
March 2016  9022      
April 2016        
May 2016        
June 2016        
July 2016        
August 2016        
Sept. 2016        

Chart 3 shows the difference between the Daily Production Numbers of the EIA's Weekly Reports, and the EIA's Monthly report. The EIA monthly production number is now "only" 60,000 bpd greater then the last weekly report for the month of December.  This is certainly an improvement from the difference of 353,000 for the month of Sept.  With the January production now reported at 9179, and with the EIA reporting 9221 on the weekly report at the end of January, the Monthly production data is now below the weekly production data for the first time in months. 


(Chart 4) Comparison of the EIA Drilling Productivity Report and the EIA Monthly Production Report
Month Predicted Production +/- Actual Reported Monthly Production BPD +/-
Sept. 2015 -93,000 BPD +45,000
Oct. 2015 -80,000 BPD -75,000
Nov. 2015 -93,000 BPD  -49,000
Dec. 2015 -118,000 BPD  -93,000
Jan. 2016 -116,000 BPD  -56,000
Feb. 2016 -116,000 BPD  
March 2016  -92,000 BPD  
April 2016 -106,000 BPD  
May 2016 -114,000 BPD  
June 2016    
July 2016    
August 2016    
Sept. 2016    

Chart 4 is a comparison between what the EIA is reporting on their Drilling Productivity Report (http://www.eia.gov/petroleum/drilling/#tabs-summary-2) and their Monthly Production Report (http://www.eia.gov/dnav/pet/pet_crd_crpdn_adc_mbbl_m.htm).  This should help give an idea of how accurate their estimates of future production are.  Clearly the EIA was way off in their Sept. estimate, as they were predicting a decline of nearly 93,000 BPD, when in fact the EIA reported an increase for September of 45,000 bpd.  The EIA reported that prodution was down 49,000 bpd. in November.  The EIA had been predicting that production would drop by 93,000 bpd. The EIA was also off in their December estimate, as they were estimating production would decline by around 118,000 bpd, when in fact production declined by 93,000 bpd.  Never the less, that is three months in a row that production has fallen.  The EIA was predicting a decline of 116,000 bpd. in January, when in fact production fell by only 56,000 bpd.  We shall see if the January number is revised downward in the coming months.