Weekly U.S. oil demand data from the Energy Information Administration (EIA) has been significantly overstated compared to final monthly oil demand, according to oil data analytics firm OilX noted Friday.
“US weekly data significantly overestimated total monthly oil demand, not only for other oils, but also for road fuels,” OilX said in a Twitter post.
Weekly demand estimates in March have already shown that recent demand strength has eased, according to the analytics firm.
“That may turn out to be even lower if the recent errors against the monthlys continue in the same way,” OilX noted.
The EIA Oil Supply Monthly, released Thursday, show this total product supplied – the proxy for total oil demand – averaged 19.731 million barrels per day (bpd) in January.
Weekly data from the EIA pegs US oil demand at a much higher level – 21.7 million bpd.
“While the weekly data pegs demand at 21.7mb/d, the monthly data puts it back at nearly two million barrels per day at 19.73mb/d,” energy columnist Javier Blas said. and commodities at Bloomberg, noted Thursday, also noting “the huge downward revision to U.S. oil demand for January 2022.”
The downward revision could be a sign that demand was not as strong as many analysts thought earlier this year.
In the latest weekly assessment, the EIA estimated that gasoline demand alone fell from 8.63 million bpd to 8.5 million bpd last week.
“Falling demand for gas, along with growing total inventories, is contributing to lower prices. If demand continues to fall as gasoline inventories continue to build, the national average will likely continue to fall. “, said AAA. noted Thursday, noting that gasoline prices have fallen slightly this week.
“The downdrafts will continue as oil falls after the SPR announcement,” said Patrick De Haan, head of oil analysis at GasBuddy. noted Thursday after the United States announced the biggest ever SPR release. “Almost every state will see a drop in #gas prices over the next week and potentially beyond,” De Haan added.
By Tsvetana Paraskova for Oilprice.com
More reading on Oilprice.com: