California oil production rises slightly The amount of oil pumped from the ground in California rose last year for the first time since 1997, according to federal government statistics released Wednesday. The increase was tiny - less than 1 percent - and came at a time of booming oil production in some other states, thanks to the combination of horizontal drilling and fracking. Price drives increaseInstead, the increase is the result of oil prices, which have stayed high long enough that companies have the confidence to invest in more wells. Kustic's office, the state Division of Oil, Gas and Geothermal Resources, has not yet released its own 2012 production statistics, which will go into greater detail than the federal figures. 'Financial pressure'"The reality seems to be that the financial pressure to monetize the Monterey Shale is so great that we had better be prepared for it," said Damon Nagami, senior attorney with the Natural Resources Defense Council. The Division of Oil, Gas and Geothermal Resources has proposed a series of regulations that Nagami considers a good start, even if they don't go far enough to protect water supplies. Last year's slight rise in production, Hull said, should remind people that oil still plays a big role in the state economy.