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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: diana g who wrote (46260)	6/11/1999 2:23:00 AM
From: upanddown	Read Replies (2) \| Respond to of 95453

Where are those Missing Barrels??? Surely they'll pop up any day now and drive down the price of oil. Missing Barrels ? You want to know about those stinkin' missing barrels ? OK, Diana, don't say I didn't warn you.<vbg> I exchanged some E-mail with a guy at EIA and he helped me understand this issue better. I guess I'am the thread obsessive on world supply/demand since I think it is a hell of lot more important than API stats or GOM rig counts. The IEA in Paris goes thru all kinds of convolutions to come up with world supply and demand numbers. Then, as a balancing item, they try to calculate the change in OECD stocks to try to balance the stock change to the net of supply - demand. This process is even more convoluted than getting the S/D numbers. The brain-dead media would have you believe that this is a brand-new problem. Not exactly since it has been a problem for 26 years. The IEA has been trying to do this since 1973 and it has been in balance for just 2 years. For the last 4 years, we have had what is called "positive missing barrels" where the net of supply - demand is greater than the calculated stock change. This also was true during most of the 70's. In the 80's and early 90's, we had what is called "negative missing barrels" where the net of supply - demand is less than the calculated stock change. In all, 14 years of positive and 10 years of negative and just two years in balance. The recent publicity about it is due to the fact that the "positive missing barrels" total in 1998 was the highest since 1976 and was accompanied by an oil crash (which was due in part to the missing barrels and the G-word that was in every oil story). Why they bother to create this balancing item that only causes confusion and never works is beyond me. The two years it worked was probably just coincidental. It is all detailed in this report that GAO prepared for the Senate Budget chairman, Pete Domenici. gao.gov Best, John