Flooding The Market And Other Hyperbole -- May 26 ,2015

It took all the energy I had to link this story. Bloomberg is reporting:

Iraq is taking OPEC's strategy to defend its share of the global oil market to a new level.

The nation plans to boost crude exports by about 26 percent to a record 3.75 million barrels a day next month, according to shipping programs, signaling an escalation of OPEC strategy to undercut U.S. shale drillers in the current market rout.

The additional Iraqi oil is equal to about 800,000 barrels a day, or more than comes from OPEC member Qatar.

The rest of the Organization of Petroleum Exporting Countries is expected to rubber stamp its policy to maintain output levels at a meeting on June 5.

Talk about hyperbole ... taking things to "a new level."

I saw the article earlier today but was ambivalent about linking it. A reader sent the link later and I figured for archival reasons, I need to link it. 

The headline for this story: Iraq Is About To Flood The Oil Market.

That was a Bloomberg headline. A country at war, who has just lost its biggest province to a JV team, and simply announces it will increase production is hardly "about" to do anything. Then, when I saw the "800,000 bopd" increase -- ? That's hardly "flooding" the market. I have no idea what it even means to say this is equivalent to what "comes from OPEC member Qatar. 

I don't want to mix apples and oranges, production vs exports, but production figures are very, very hard to come by. Even import figures are several months old. But that statement suggesting the additional Iraqi oil is more than what comes from Qatar is almost laughable. In the most recent data available, and again note, this is imports NOT production, the US imports as much oil from the Bahamas as it does from Qatar. 

Bloomberg may link the Iraqi message to US fracking, but one can hardly deny that this is as much about OPEC members scrambling to save market share as it is about competing with US shale. 

From the attached graph, it certainly looks like Qatar is scrambling to find new markets for its oil. I assume Bahrain is also scrambling to find new markets for its oil. 

Source: EIA.

In a few months, we will get the data. US auto dealers report auto sales for any given month within 24 hours after the end of the month; on the other hand it takes the EIA three months or more to tally up how much oil is imported into the US. This is almost June and the latest data is for February. And as far as "production" goes, it's anybody's guess what foreign countries are actually producing.