Oil in Global Economy Series: EIA’s missing barrels quite large

According to United States’ Energy Information Administration (EIA), the U.S. weekly production touched 9.51 million barrels per day for the week ending October 20th. However, this is somewhat a faulty number; a guestimate, which gets revised in the Monthly report.

The production gap between the monthly estimates and weekly estimates are popularly known as the ‘missing barrels’ and recent data suggest that investors should use caution when taking the weekly estimate to their face value as the missing barrels are getting quite larger. For example, According to EIA’s monthly report, U.S. oil production was 9.203 million barrels per day; however, the weekly estimate shows that the production was 9.496 million barrels per day. Hence, the missing barrels in August was 0.293 million barrels per day. The number is larger than the production two OPEC producer. When converted to month, the number is quite large at 8.8 million barrels.

The monthly report shows that the production in the United States has rebound from 2016 low but neither by as much as originally forecasted nor by as much as the EIA’s weekly guestimate suggests.