The EIA, or Energy Information Administration, records the inventories of US and foreign produced petroleum, these inventory levels directly affect the price of petroleum sold in the United States and abroad.
Just like any other good or service, petroleum prices are determined by the supply and demand forces of the energy market. When the market is expanding and the economy is characterized by positive growth, inventories decrease due to high levels of demand, which causes a supply shortage, thereby jacking up prices. In contrast, when the market is contracting and the economy is slowing, there is an excess of supply as inventories build and demand drops, decreasing prices.
Crude oil, gas, and petroleum remain linchpins of today’s economy, and contribute heavily to global employment, manufacturing, and transportation amongst other things. Because of its involvement in a variety of sectors and industries across the globe, fluctuations in price can heavily impact the direction and growth of any one, or many, economies. Changes in the price of these goods cannot impact inflation, as inflation represents the rise in price of all goods, which would keep oil’s relative price to other goods the same. However, fluctuations in petroleum pricing can and do impact the PPF (production possibility frontier) for both itself and for other goods, which can create an effect which resembles short term changes in inflation. But here the cause for this effect stems from a change in the entire production capabilities of the economy, and not from the simple change in price from a single good.
Because of this, we can observe trends in changes of consumer prices. As the price of oil falls, consumer prices tend to moderate as the costs of production fall for the economy. As the price of oil increases, the cost of production for a variety of goods increases as well, raising consumer prices.
It is obvious that generating an understanding of oil production levels on a frequent basis is paramount to anticipating market trends and potential expansion or collapse.
We thus ask, What will be the total stock of crude oil and other petroleum products for February 2021?
Other Related Questions:
The resolution criteria will be provided from the EIA through their measurements on the weekly stocks of petroleum and other liquids. This metric is recorded as the total stock of crude oil and other petroleum products excluding SPR (strategic petroleum reserve) in thousands of barrels. If this data is not released, or no longer collected, the question will resolve ambiguously.