The EIA released the Petroleum Supply Monthly (PSM) today and introduced a new category called “Transfers to Crude Oil Supply.” This is a new volumetric balance for crude oil and biofuels that includes barrels of unfinished oils (refinery feedstocks) and natural gas liquids (NGLs) that have been identified as additions to the crude oil supply through blending. These figures add an average of 450 Mb/d to the reported crude supply, with the latest month, June, showing nearly 650 Mb/d of additional supply. When added to the field production numbers traditionally reported in the PSM, total crude production reached 13.5 MMb/d in June, a full 1.2 MMb/d over the average supply reported in the Weekly Petroleum Status Report (WPSR) for June, and a new record high for domestic crude supply.
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What's Your Name - Explaining the EIA's Huge Unaccounted Crude Oil Imbalances
The numbers don’t add up. Literally. The most closely watched energy statistics in the world have a problem, and it’s been getting worse over the past two years. We’re talking about EIA’s U.S. crude oil supply, demand and inventory balances, which are published each week and then trued up about 60 days later in monthly data. The problem is that the balances don’t balance. EIA uses a plug number alternatively called “adjustment” or “unaccounted for” to force supply and demand to equate. That would not be an issue if the plug number was small and flipped frequently from positive to negative, likely due to timing inconsistencies with the input data. But that’s not the case. The number is mostly positive, meaning more demand than supply. And the difference can be mammoth: last week it was 2.3 MMb/d, or 18.4% of U.S. crude production. It seems like barrels are somehow materializing out of nowhere. But now we know where, because EIA just finished a 90-day study of the crude imbalance that reveals the sources of the problem and what it is going to take to fix it. In today’s RBN blog, we will delve into what has been causing the problem, what it means for interpreting EIA statistics, and what EIA is doing to address the issues.
