Under normal circumstances, this figure suggests to us that crude supply is inflated by the addition of non-crude material being diverted into delivered crude steams.
The negative readings between April-July imply that a sizeable volume of crude was being put on storage at the height of the supply overhang in areas of lower visibility.
A return now to positive territory hints at these volumes being drawn down, whilst the sheer size of the swing helps explain the increase in implied US production of late.
Research Highlights - Week 31
The EIA’s crude oil supply adjustment, which accounts for the difference between crude supply that can be accounted for and crude refined, exported, or otherwise lost, had been running consistently in positive territory until the April price crash (see Americas Weekly – Issue 30).