Since the data showed a fall in U.S. stocks, oil prices have increased by more than 2%.
Over the a year ago, the depressed commodity prices forced several USA oil and gas producers to reduce their output in order to sustain their operations.
At 10.011 million barrels a day, Saudi's production is still below the 10.058 million a day agreed on in the OPEC production cut deal, but oil prices are reacting to Saudi's surge.
The 10.01 million bpd are still below Saudi Arabia's self-imposed quota of 10.058 million barrels daily under the OPEC agreement, but they are 263,300 bpd more than the country's January output-a fact that is not lost on the already excessively volatile market.
Saudi Arabia "is committed and determined to stabilise the global oil market by working closely with all other participating Opec and non-Opec producers", its energy ministry said.
The data, he added, also suggests that oil prices around $50 a barrel are encouraging the restart of idled USA shale oil output.
That was reflected in rising United States imports year-to-date (exports were also higher) which were running at 400,000 b/d more than a year ago and combined with higher domestic output, which was up by another 400,000 b/d since September 2016, and a drop in refinery utilisation rates.
US April crude futures fell 68 cents, or 1.4%, to settle at $US47.72 a barrel in NY, for a seventh straight session decline.
OPEC said its production, including Nigeria and Libya, fell by 140,000 bpd in February to 31.96 million bpd, led by a large Saudi cut. That's about what OPEC agreed to cut in production, though the IEA said its first quarter growth forecast was revised lower by 300,000 bpd. It would be important to watch the production levels in Iran as the production has moved up. The contracts ended 89 cents and $1.14 higher respectively Wednesday.
"The EIA expects higher US oil output because the number USA oil rigs operating has almost doubled from the low set last May", said Vivek Dhar, a commodities strategist for Commonwealth Bank of Australia. EIA expects oil production to top nine million barrels a day in 2017.
The Energy Select Sector SPDR (XLE) is trailing the broader market, falling 1 percent in trading on Tuesday, March 14, versus a 0.4 percent fall for the broader market.
"Oil is under renewed pressure as Saudi Arabia's production increased to over 10 mbpd again, according to OPEC report", Shawn Koopman, an analyst with trading firm Ava, said in a tweet.
The problem is that, despite the production cut, the world is awash in oil.