{"id":11634,"date":"2023-12-22T20:50:32","date_gmt":"2023-12-22T20:50:32","guid":{"rendered":"https:\/\/connectwithfund.com\/investment\/why-the-u-s-government-is-changing-the-way-it-collects-data-on-the-oil-market\/"},"modified":"2023-12-22T20:50:33","modified_gmt":"2023-12-22T20:50:33","slug":"why-the-u-s-government-is-changing-the-way-it-collects-data-on-the-oil-market","status":"publish","type":"post","link":"https:\/\/connectwithfund.com\/?p=11634","title":{"rendered":"Why the U.S. government is changing the way it collects data on the oil market"},"content":{"rendered":"
\n

The U.S. Energy Information Administration has been implementing changes to the way it collects its data, and it hasn\u2019t been easy to understand what those changes mean for the traders who use the government agency\u2019s reports to make key decisions.<\/p>\n

Looking through the changes to the EIA\u2019s data collection process, Tyler Richey, co-editor at Sevens Report Research, said it was \u201cnot very clear exactly how the data will be affected.\u201d<\/p>\n

\n

It appears that previous data collection processes had \u201c\u2018loopholes\u2019 that allowed certain condensates and \u2018other oils\u2019 to not be reported in inventories, but now will be required to be reported in total oil inventory figures,\u201d he said. <\/p>\n

The simplest takeaway is that the next effect of this change should result in oil inventories being higher than they previously were, said Richey.<\/p>\n

The EIA in March explained that the difference in its estimates of supply and disposition had increased in its U.S. crude-oil balances and that it was studying the growing difference. It identified ways in which is has been \u201coverstating disposition and understating supply.\u201d<\/p>\n

Also in March, when the government agency released its Annual Energy Outlook 2023, it included a note that said the National Energy Modeling System, which produces the annual outlook, requires \u201csubstantial updates to better model hydrogen, carbon capture, and other emerging technologies.\u201d As a result of that, the agency does not plan to publish an annual report for 2024. <\/p>\n

Then, in a posting on social-media platform X, the EIA said in August that it was going to implement changes in three phases, in an effort to \u201cimprove our accounting of petroleum supply and disposition.\u201d<\/p>\n

The government agency also delayed last week\u2019s Petroleum Status Report covering the week ended Nov. 3, citing \u201cplanned system upgrades,\u201d though it wasn\u2019t clear if that was directly connected to the data collection changes. <\/p>\n

The EIA released two weeks of data on Wednesday. It reported a climb of 3.6 million barrels in domestic commercial crude inventories for the week ended Nov. 10. The data total it provided for the week ended Nov. 3 revealed a rise of 13.9 million barrels from the week ended Oct. 27. <\/p>\n

Read:<\/strong> Oil prices decline as U.S. crude supplies mark a 2-week climb of more than 17 million barrels<\/p>\n

Earlier this week, it explained that the Weekly Petroleum Status Report released on Nov.15 would begin showing \u201ctransfers to crude oil supply to national volumetric balance tables for petroleum and biofuels, and propane that is fractionated and ready for sale.\u201d <\/p>\n

\u201cTransfers to crude oil supply,\u201d the EIA said, include barrels of unfinished oil and natural-gas liquids it defined as being added to crude-oil supply blending.\u00a0\u00a0<\/p>\n

It\u2019s \u201ctrying to break down the types of oil in the report so people can get a better view as to what the total number reflects,\u201d said Phil Flynn, senior market analyst at The Price Futures Group. <\/p>\n

\u201cThe old way of collecting that data added to either the undercounting of some barrels, or the double counting in other cases,\u201d he told MarketWatch. That led to the EIA \u201chaving to make huge weekly and monthly adjustments to the barrels.\u201d<\/p>\n

That also led to a \u201cfalse sense of security when different grades of oil were grouped together giving the impression that there was more or less supply than was really available,\u201d said Flynn. At the same time, it skewed the EIA\u2019s implied demand numbers and, in many cases, led to the \u201cperception of lower demand\u201d than what was actually occurring.<\/p>\n

<\/p>\n

<\/p>\n

\n

\n \u201c<\/span>The EIA has been attempting to \u201cevolve with the new ways that we are producing oil.\u201d\u201d<\/span>\n <\/p>\n


\n \u2014 Phil Flynn, The Price Futures Group<\/span>
\n <\/small><\/p><\/div>\n<\/p><\/div>\n

The agency has been attempting to \u201cevolve with the new ways that we are producing oil,\u201d he said. The shale revolution and new production techniques have \u201ccreated more blends of crude that are not as easily put into a lump sum category.\u201d<\/p>\n

By breaking down crude-oil classes, the EIA will allow the reporting to be more accurate as it improves its data collection, he said.<\/p>\n

That said, the EIA is not done making its changes. <\/p>\n

On Wednesday, the agency noted that while it has resumed its regular data publication schedule following last week\u2019s delays, \u201cintermittent disruptions to data availability via dashboards, tools, and data browsers on our website will continue as we complete our planned system upgrades.\u201d<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

The U.S. Energy Information Administration has been implementing changes to the way it collects its data, and it hasn\u2019t been easy to understand what those changes mean for the traders who use the government agency\u2019s reports to make key decisions. Looking through the changes to the EIA\u2019s data collection process, Tyler Richey, co-editor at Sevens Report Research, said it was \u201cnot very clear exactly how the data will be affected.\u201d It appears that previous data collection processes had \u201c\u2018loopholes\u2019 that allowed certain condensates and \u2018other oils\u2019 to not be reported in inventories, but now will be required to be reported<\/p>\n","protected":false},"author":1,"featured_media":11635,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[40],"tags":[],"class_list":["post-11634","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investment"],"yoast_head":"\nWhy the U.S. government is changing the way it collects data on the oil market | ConnectWithFund<\/title>\n<meta name=\"description\" content=\"The U.S. Energy Information Administration has been implementing changes to the 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