There's a fight going on about US inventories
If you haven't been following the oil market, you have missed some good twitter fights.
It stems back to the incredible 7.9 million barrel per day rise in weekly US oil inventories. The problem is that the market has changed. The US used to export very little crude but now it's exporting huge amounts.
Why that matters is because tanker data showed a jump in US exports last week to as much as 4.4 million barrels per day. However the EIA reported that they fell to 2.37 mbpd, a drop of nearly a million barrels per day. The discrepancy accounts for nearly the entire build in weekly inventories.
The question is: When is the oil actually exported. You would think it was when it left the port but you would be wrong, according to EIA analyst Mason Hamilton.
He went onto say that, "those harping on the EIA weekly import/export data without noting these facts are simply displaying their ignorance or have an agenda."
Analysts who are more-interested in how much oil is actually in the United States are annoyed to say the least. They've relied on this data for a generation and now it's essentially useless on a week-to-week basis because there's a big window for when exporters can file the paperwork.
One of them is Phil Flynn, when went on a rant in an article in Futures Magazine.
So those of you struggling in the shale patch looking to the EIA to give you good weekly data to guide your business is simply ignorant of the fact that the EIA data is basically worthless on a weekly basis. Inaccurate weekly swings of millions of barrels that move markets and impact your livelihood should be ignored for at least 4 weeks. Or at least until the paperwork gets done. Of course if you have a problem with that, I am sure you have an agenda, like trying to stay in business.... I believe the EIA should use the tactics of the private sector to give the taxpayers, who pay for this data, the best most accurate data possible so that they can operate their businesses in the most efficient way they can as opposed to waiting for some bureaucrat to stamp a piece of paper.
For those who are looking to this data, the trick will be to check on the weekly exports number before casting judgement.
