On Friday, the latest data from oil driller Baker Hughes showed that 84 oil rigs shuttered production last week, taking the number of rigs in use to 1,056.

This is down about 35% from a peak of 1,609 hit in October, but is still less than the 40%-60% decline that Baker Hughes said the rig count has declined by during past downturns in oil prices.

And in a note to clients on Monday, Goldman Sachs analyst Damien Courvalin said the current decline is not enough to dent US production.

"The rig count decline is still not sufficient, in our view, to achieve the slowdown in US production growth required to balance the oil market," Courvalin wrote.

"The flexibility in cutting non-contracted rigs and associated cost deflation along with the producer hedging that has occurred over the past weeks and the recent wave of equity issuance raise the risk that the US production slowdown will be delayed. As a result, we reiterate our view that oil prices need to remain lower in the coming quarters in order for the announced capex guidance and rig reduction to materialize into sufficiently lower production growth."

Earlier this month, we highlighted this chart from economist Mark Perry which shows that in January, US oil production rose to levels not seen since the 1970s.

And as Goldman sees it, if production remains near these multi-decade highs, even with the recent reduction in rig count, oil prices are going lower.