US Retail Sales Up -- May 13, 2016; Wow, This Is Suprising -- OPEC Producing More Oil As We Go Into Driving Season

Updates

Later, 1:58 p.m. Central Time: the most recent GDPNow forecast is out, released May 13, 2016:

The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2016 is 2.8 percent on May 13, up from 2.2 percent on May 10. After this morning's retail sales report from the U.S. Census Bureau, the forecast for second-quarter real consumer spending growth increased from 3.0 percent to 3.7 percent. 

It's been my impression that the GDPNow forecast has not been all that accurate. It was about the same time in "the cycle" when the GDPNow forecast for 1Q16 was also 2.2. We know how that turned out. LOL. Or TIMB.

Back on March 4, 2016, a talking head over at CNBC said a recession was virtually assured this calendar year.
 

Original Post

 

We've been waiting for this, from the WSJ, headline story, just posted a couple minutes ago:

American consumers showed signs of strength in April, propelling retail sales up by 1.3% from the prior month, the Commerce Department said Friday. It was the best monthly gain since March 2015. Economists surveyed by The Wall Street Journal expected retail sales to rise 0.8%.

The surge in sales was led by autos, gas stations and nonstore retailers, which include shopping websites such as Amazon.com. It follows several gloomy earnings reports from U.S. department stores. 

Now we need to see what GDPNow reports. It's previous report, May 10, 2016, was quite impressive considering. Earlier this year, I think it was in March, a CNBC talking head said that a recession in 2016 was all but guaranteed. We still need that first quarter of negative growth to have that happen.

Regardless, the next GDPNow update should be out later today.

By the way, speaking of which, I forgot to check "gasoline demand" yesterday; there was just so much "stuff" coming out, I couldn't keep up.  Relativity flat, week over week, but at 9.658 million bbls per day, we're getting close to 10 million bbls which would be "unheard of." By the way, and this is an important note that I was not aware of until recently (and I'm not sure how accurate it is). The "gasoline demand" number that is being reported apparently also includes the amount of gasoline that is exported. But it's also been said that the percent of gasoline exported is trivial compared to the amount that stays in this country. Sticking with the blog's "mandate" I won't be changing the way I report / follow / talk about "gasoline demand." At least for now.

Meanwhile, OPEC production data points:

• most likely hit all-time high 
• highest since "at least" 2008
• at 32.44 million bopd, up 188,000 bopd from March 

March: 32.252 million bopd
188/32,252 = 0.58% increase since March
Let's see? summer coming up? driving season? air conditioning needs in Saudi Arabia?

OPEC's report points to a 950,000-bpd excess supply on average in 2016 if the group keeps pumping at April's rate, up from 790,000 bpd implied in last month's report.

A big "if."

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Force Majeure

Meanwhile, in Nigeria, ExxonMobil has declared force majeure:

In the midst of a militant resurgence in the Niger Delta and a two-week ultimatum for oil companies to shut down operations, Exxon Mobil has reportedly declared force majeure on Qua Iboe crude after an accident the company said was not related to militant attacks.

What fresh hell is this? It turns out a drilling rig hit a subsea pipeline. Qua Iboe crude is Nigeria's largest crude stream. About 350,000 bopd were scheduled to be shipped in May. Oh, well.

So, let's see. OPEC pumped 188,000 bopd more in April than in March, and now "we" lose almost 350,000 bopd from Nigeria.