I did a little poking around the EIA website and found this graph. It shows that petroleum and other liquids stocks have been rising for over 60 years. The latest data point on the graph is from August 18, 2018. The value reported last week by EIA is about 1,910,000 Mbbl.
Here are some interesting take aways.
- During the Vietnam Era, inventories are rising despite the need to fuel ships and tanks.
- In the 70’s and 80’s, when America was facing an energy shortage, an Arab oil embargo, and an Iranian hostage crisis, inventories are still surging upwards.
- Things seem to stabilize a bit after 1990, with our involvement in Iraq, the former Yugoslavia, Somalia, and Afghanistan.
- Inventories start to rise again around 2008 – 2009. Some of the rise comes from increased production in Saudi Arabia, which drove the price of oil down below $30/barrel.
The bottom line is that it makes no sense to me. Why is the US continuing to produce when inventories just keep going up up up? National security? I doubt it.