Sunday, September 4, 2016

Spare Capacity vs. Above Ground Storage

A lot has been made about the large above ground oil inventories. The EIA publishes an update on this weekly. As you can see the above ground storage is well above the 5 year range.
However, spare capacity (or below ground storage) has been shrinking. 
Further this Wall Street Journal article suggests that the inventory levels are not abnormal for this point in the cycle.
Maybe the market is tighter than people realize?


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