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99 comments on DrumBeat: December 17, 2006

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Charles Mackay on December 17, 2006 - 1:22pm Permalink | Subthread | Parent | Comments top
With it's further considered that exports from both the two leading oil exporters (Russia and Saudi Arabia) are dropping, as well as continued demand growth from India and Far East countries, one wonders just how much poorer countries can offset China's huge oil demands.

The answer, I suspect, is when the book is closed on the 2006 year, we will find world oil and product inventories less than in 2005.  This will also be very true in the US - despite the strong contrary impression given by the media.  As of last week, 12/08/2006, US oil/product inventories were only 4 million barrels ahead of last year.

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Hothgor on December 18, 2006 - 12:55am Permalink | Subthread | Parent | Comments top
And that clearly explains how global oil inventories are near their all time highs.
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Charles Mackay on December 18, 2006 - 9:50am Permalink | Subthread | Parent | Comments top
The IEA reports a 41 million drop in world inventories in October - well before the typical seasonal winter fall.  In addition, the EIA has US inventories dropping significantly in November.

Next time I will only respond if you document your position first.

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Hothgor on December 18, 2006 - 1:40pm Permalink | Subthread | Parent | Comments top
Out of several billion barrels in inventory.  And that drop was precisely what OPEC wanted when they cut their production by 1.2 million bpd.  If anything though, it shows they only needed to cut production by about 600,000 bpd to bring the market into balance.
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Freddy Hutter on December 18, 2006 - 7:34pm Permalink | Subthread | Parent | Comments top
Charles forgot to mention the rest of the paragraph.  Nov 30th inventories were at 54 days vs 53 on that date last year.
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Hothgor on December 18, 2006 - 8:49pm Permalink | Subthread | Parent | Comments top
And just think, this is all in light of the fact that we apparently experienced dramatic reduction in exports around the world, as WT has been saying these last few months.  That or all the post peak production countries have had a miraculous turnaround this year! <chortle>
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