The IEA’s report on the last year just released a huge amount of barrels that missed between the production and the delivery. The amount is around 800,000 barrels per day compared with a 1.9 million barrels oversupply per day. Due to this fact, the oversupply of oil is not serious as the market thinks with this missing barrels.
Last year, there were 800,000 barrels of oil a day unaccounted for by the International Energy Agency, the energy monitor that puts together data on crude supply and demand. Where these barrels ended up, or if they even existed, is key to an oil market that remains under pressure from the glut in crude.
Here’s how a barrel of crude goes “missing” in the data. Last year, the IEA estimated that on average the world produced around 1.9 million barrels a day more crude than there was demand for. Of that crude, 770,000 barrels went into onshore storage while roughly 300,000 barrels were in transit on the seas or through pipelines. That left roughly 800,000 barrels a day unaccounted for in the data. Global oil supply is about 96 million barrels a day.
In the fourth quarter, the number of missing barrels reached as high as 1.1 million barrels a day, or 43% of the estimated oversupply during that period.
“If the market is tighter than assumed due to the missing barrels, prices could spike quicker,” said David Pursell, managing director at energy-focused investment bank Tudor, Pickering, Holt & Co.
While on the contrary, this result could also came from the calculating mistakes.
In 1998, the last time the number of missing barrels was so high, concern over the discrepancy reached the U.S. Congress. A U.S. senator asked the Government Accountability Office, a nonpartisan agency working for Congress, to examine the IEA data. The agency found that “[statistical] limitations can introduce errors into the data, although the magnitude and direction of these errors are not clear.”