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Domestic crude production fell 276,000 barrels per day to 11.806 million bpd in July, according to data published by the U.S. Energy Information Administration on Monday.

The month-on-month reduction was entirely attributable to the Gulf of Mexico, where output fell 332,000 bpd, because many offshore platforms were shut due to the threat from tropical storm Barry.

Onshore production from the Lower 48 states, much of it from shale plays, actually increased by 63,000 bpd to a multi-decade high of 9.778 million bpd.

Even onshore, however, there were signs the frenzied production growth of 2017 and 2018 has run out of momentum, as shale firms throttle back in response to lower prices.

Onshore output was up by 1.149 million bpd in July compared with the same month a year earlier, but growth has slowed progressively from 1.900 million bpd in August 2018.

Of the major oil-producing states, Texas has reported the sharpest and most consistent slowdown, with more gradual decelerations in New Mexico and North Dakota.

The second U.S. shale oil boom (2017-2018) is ending for much the same reasons as the first (2012-2014): high prices encouraged over-production and global oil consumption growth cooled.

Experience suggests changes in oil prices filter through to drilling with an average delay of around 4 months and to output with a total lag of around 12 months.

Production in July, therefore, reflected the relatively high prices that prevailed before oil prices started to slump in October 2018.

Since then, as prices have tumbled, the number of rigs drilling for oil has fallen by 175 or 20%, according to oilfield services company Baker Hughes.

Lower prices and drilling activity should start to filter through into even slower growth in Lower 48 output towards the end of the year and into 2020.

Prices will remain low to enforce a U.S. drilling and production slowdown unless and until there are stronger indications of economic growth next year.