2010 Oil Story: Drawing Down the Inventories - Business Insider

I agree with the Economist Magazine’s conclusion that most of the difference between 82.095 mbpd produced and 87.382 mbpd consumed came from stock changes . In other word, the drawing down of oil from inventories. Indeed, this was a key driver for oil’s advance last year from the high $70′s to over $90 a barrel. In the chart below, from the latest EIA Paris Oil Market Report , you can see that starting in mid-year, Total OECD inventories started a new decline. Moreover, the histograms in the below chart also show the difference to the five year average, which also illustrates the global stocks drawdown. This coincided by the way with a resurgent, mid-year advance in the price of oil from a low of $69 to $92 by year end.

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No, it does not . Switching to BP’s preferred Mtoe energy unit (million tonnes oil equivalent), I find that total biofuels production was only 59.26 Mtoe in 2010. Compared to 4,028.10 Mtoe of oil consumed, there is at best 1.47% biofuel consumption embedded in BP’s total consumption figures for oil. Thus, the story of 2010–and it’s a very important story indeed–is intact. Unable to meaningfully increase global oil production to meet demand, the world ate through inventories. PR * Copyright © 2011 Business Insider, Inc. All rights reserved. Registration on or use of this site constitutes acceptance of our Terms of Service and Privacy Policy .

2010 Oil Story: Drawing Down the Inventories - Business Insider