Supplies decline sharply again

INVENTORIES: Despite report, the price of oil barely rises

Crude oil inventories again fell significantly, draining U.S. stockpiles by more than 10 million barrels over the past two weeks, the Energy Department reported Thursday.

Commercial crude inventories fell 6.4 million barrels last week, following a 4-million-barrel decline the previous week. Gasoline inventories fell by nearly 2.9 million barrels last week.

The declines were good news for oil markets, where prices have trended lower recently over concerns that rising U.S. production is offsetting output cuts by OPEC and other major producers and keeping global markets awash in oil. In a separate report, the Energy Department said oil production in the United States has climbed by 318,000 barrels a day since OPEC began cutting its output at the beginning of the year.

But U.S. production is not growing as fast as the government earlier predicted. Domestic oil output grew to about 9.1 million barrels a day in March, up from 9 million the month before and 8.8 million in December, according to the Energy Department’s

monthly estimates. The March production figure is about 0.5 percent lower than the department’s earlier estimate of 9.15 million barrels a day for the same month, a sign that U.S. output could come in lower than the agency has forecast this year.

In March, according to the monthly data, daily oil production in Texas barely registered an increase, edging up 0.1 percent to 3.3 million barrels.

Daily production in Wyoming surged 8.5 percent to 203,000 barrels, and it increased in Oklahoma by 2.4 percent to 425,000 barrels.

The report of rising production helped offset early gains in crude prices that followed the release of inventory data. Crude rose 4 cents a barrel Thursday to settle at $48.36 a barrel in New York.

Over the past four weeks, demand for petroleum products rose slightly from the same period last year, the Energy Department reported. Consumption of gasoline, however, was down slightly — less than 1 percent — to about 9.6 million barrels a day.