Weekly Petroleum Report -- Fourth Of Four Charts -- March 7, 2018

John Kemp regularly posts modified EIA graphs to accompany the EIA's weekly petroleum reports. He may post as many as a dozen or so such graphs every week after the report is released.

Today I took particular note of four of his graphs.  The first three graphs have to do with gasoline, but to spread this out, I'm posting one at a time.

This is the fourth (and last) graph of the four.

Everybody's making a big deal that US crude oil inventories have decreased significantly since last year at this time. Is it a big deal? Maybe it is, maybe it isn't? If you are dying of thirst, stranded on a over-turned boat in the middle of a body of water, would it matter if it was the Mediterranean Sea or the Pacific Ocean. (Yes, I know the analogy is just the opposite of what we're talking about, but you get the idea.) Last year the "glut" was 300,000 bbls over the 10-year median. This year, the "glut" is 200,000 bbls over the 10-year median. If the decline were continuing at the same rate, then it might mean something, but the decline is not continuing. It has leveled off (in fact, it's been going up the past three weeks, or so).

It's also important to note that the 10-year median has been artificially "elevated" by two of the ten years -- during the Saudi Surge, when Saudi opened the spigots (2015 - 2017). Knock that median down a bit and the "glut" is even worse than that shown in the graph above.

The most recent "re-balancing data" is at this post, and it's trending in the wrong direction.