Oil bulls got another piece of bad news March 16 from an unlikely source: the Federal Reserve.
U.S. crude production has continued to rise in spite of the collapse in oil prices.
The Fed's oil extraction index clocked in at a seasonally adjusted 179.8 in February. That's up 0.4% from January and 14.4% from a year ago. As Morgan Stanley economist Ted Wieseman put it in a note to clients, the supply/demand imbalance in the oil market "isn't being addressed yet by lower U.S. supplies."
The nosedive in oil prices has had an impact on oil and gas drilling. The Fed's index for that activity fell 17.4% in February from the month before and was down 21.4% from a year ago.