The Brent oil price crashed nearly -4% last night to $46.95. Henry Hub is still firm at $2.88mmBtu:
The big news on the night was the confession by the EIA that it has grossly exaggerated US demand through H1 by underestimating exports:
Starting with today’s release of the Weekly Petroleum Status Report (WPSR), EIA is now publishing weekly petroleum export and consumption estimates based on near-real-time export data provided by U.S. Customs and Border Protection (Customs). EIA previously relied on weekly export estimates based on monthly official export data published by the U.S. Census Bureau roughly six weeks following the end of each reporting month. This new methodology is expected to improve weekly estimates of petroleum consumption (measured as product supplied) by improving estimates of weekly exports of crude oil, petroleum products, and biofuels, which increased from 1 million barrels per day (b/d) in 2004 to nearly 5 million b/d in 2015.
The use of near-real-time export data should reduce differences between EIA’s weekly data, as presented in the WPSR, and monthly data, as presented in the Petroleum Supply Monthly (PSM). The monthly data that EIA publishes 60 days after the end of each month are based on EIA’s comprehensive monthly survey data and the actual Census Bureau export data for that month.
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David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
