US Crude Oil, Petroleum In Storage -- March 10, 2022

IN DRAFT

A reader suggested I check in on Steven Hayward over at PowerLine together. 

Shortly after that was posted, this was released by Senators Markey and Heinrich:  

This legislation would also provide relief to Americans by advancing the direct the near-term sale of the more than 260 million barrels of oil by 2023 that are in the Strategic Petroleum Reserve. The sale of these barrels has already been mandated by law and are available to be deployed for the Strategic Petroleum Reserve’s stated purpose of helping protect American consumers from economic damage due to energy supply disruption. This would create a significant financial return for the American taxpayer, guard against short-term oil price spikes, and adhere to our statutory mandates.

It's important to note I'm not taking "sides" on this one. My "beef" is with folks not presenting the full picture. Right now most folks are only presenting the drop in crude oil in US inventory over the past few months. Some show only the crude oil in the SPR; some show "petroleum inventories" excluding the SPR. Some show only "crude oil" and others include "all petroleum products." They note it in the graphics but don't point it out, explaining the importance of what they chose to post.

There is also no analysis of oil / petroleum products in SPRs around the world.

Most of the graphics, as noted above, show only the last pew months which includes some record high inventories. See the third graph below which is non-SPR crude oil in commercial storage measured in number of days of storage which I think is very helpful in putting things into perspective. 

There are two huge data points that no one seems to talk about:
pre-2007-pre-shale and post-2007-post-shale; huge difference; and,
the amount of pipeline and storage that has been added, especially along the Texas coast 

Although some say we're quickly depleting the DUC inventory, that may or may not be true, but whatever DUC inventory is left is something we did not have prior to the shale revolution (DUCs). 

So, lots of variables.

Generally speaking, the president if releasing oil from the SPR in increments of 50 million bbls over one to two months

Link here. 

Link here.

Link here.