Locator: 46315INSANITY.
There's single-entry bookkeeping, double-entry bookkeeping, and then there's EIA bookkeeping which raises the art of bookkeeping to a whole new level.
How bad is their accounting? See comments:
We went from 1,287,000 bpd unaccounted for oil supply for the week ending November 24, 2023, to 1,417,000 bpd unaccounted for demand for the week ending December 1, 2023
In other words, 18,928,000 barrels disappeared from the oil balance sheet in a week's time.
A reader brought this issue to my attention at least two years ago, thank you very much. Truly a very, very strange story. Of course, this is going on in the Biden administration. The SecEnergy is Jennifer Granholm and folks know how I feel about her. See this post and re-printed down below, below the fold.
The primary data source on U.S. energy markets has struggled this year [suggesting that all previous years have been perfect) to depict weekly changes in the country's oil supply and demand, leaving some investors conflicted on how to parse information about the world's top oil producer and consumer.
For decades the market had brushed over a so-called "adjustment" in the EIA's weekly inventory report due to its relatively negligible size. But that has changed in the past year as the agency consistently posted outsized adjustments, also known as "unaccounted for barrels," sowing confusion among market participants despite changes to improve the quality of the data.
The adjustment number is a figure the EIA reports each week that serves as a balancing item when the administration's supply and demand data do not align. Adjustments are normal within the data, which, given the report's quick weekly turnaround, have to account for some margin of error.
However, market participants have consistently complained this year about larger adjustment figures. The EIA posted an adjustment number of minus 1.42 million barrels per day (bpd) in the week to December 1, 2023, the largest negative adjustment on record. In the week to December 8, 2023, the adjustment was minus 1.05 million bpd, the third largest negative adjustment on record.
Earlier this year, the EIA studied larger adjustment numbers, as the average annual adjustment in 2022 was the biggest in records dating back to 1973. The assessment found two root factors: crude oil blending accounting that overestimated domestic consumption, and under-reported oil output, the EIA said in March.
As a result, the EIA said it would change its surveys to get more accurate crude output data, and also change its accounting methods for crude oil blending.
The EIA relies on surveys from market participants to capture weekly data. But no dataset is perfect, especially weekly datasets pulled from estimates and sample surveys. The EIA encourages data users to treat the weekly data as a snapshot of trends and compare it to more vetted monthly data.
And the article continues with more non-useful information.
And the adjustments continue.
And they don't matter.
The biggest determinants of the price of oil has nothing to do with adjustments to oil in storage or even the actual oil supply. The biggest determinants of the price of oil: a) comments coming out of Saudi Arabia; b) manipulation of data coming out of OPEC; c) the strength / weakness of the dollar; d) the perceived strength / weakness of the US economy; e) comments made by the Fed that telegraph the likelihood of a recession; and, f) comments by Steve Liesman.
Clearly the dumbest US politician: Granholm. And she's got a lot of competition, starting with Kamala Harris.
