Oil Stocks Expected to Decline
When OPEC cuts, the EIA listens ...
From the EIA's Short Term Energy Outlook:
Inventories. EIA projects that the OPEC-10 cuts will be sufficient to reduce inventories to normal levels by mid-year 2007. EIA’s consumption and supply projections suggest that in Organization for Economic Cooperation and Development (OECD) countries commercial oil inventories could decline by 0.9 million bbl/d in the first quarter (compared with an average inventory draw over the past 5 years of 0.3 million bbl/d) and not build at all during the second quarter. In contrast, OECD commercial inventories have increased by an average of 0.8 million bbl/d during the second quarter over the past 5 years.
This view should fuel the oil bulls. Methinks we've seen the last of the 50s.
