5 Things To Watch In Friday’s Oil-Supply Report

More than a year after the oil-price slump began, traders are desperate to determine whether U.S. crude-oil production has started to decline in response to low prices. Mixed and delayed data from the federal government have added to the uncertainty.

1 Production May Have Peaked
The EIA forecast in early July that production peaked in April and fell by 50,000 barrels a day in May. If that’s confirmed, it could be a signal to traders that production is definitely headed lower in the second half of the year.

2 Output Revisions
The EIA is able to revise its monthly data for as many as two years, based on new information from state-level agencies. Last month’s report showed April production at a 44-year high of 9.7 million barrels a day. If output levels from past months are revised higher, that could weigh on the oil-futures market.

3 Keep an Eye on Texas
One of the most important production numbers is also the least reliable. Texas, the state with the most oil output, is slow to provide comprehensive data. The EIA adjusts the state’s preliminary figures to account for reporting delays, which means the most recent Texas numbers are particularly vulnerable to revision. Consulting firm PIRA Energy Group says its April production figure is 9.3 million barrels a day, 400,000 barrels a day lower than the EIA’s, due to its adjustment of Texas data.

Market analysts are interested in understanding for key states like Texas whether the changes in crude-oil prices or the rig count are having an impact.

4 Growing Demand
The EIA reported strong U.S. demand for gasoline and other fuels through April, and many analysts expect that trend to continue in May, as more drivers hit the road at the start of summer.

5 Update on Exports
U.S. exports of all petroleum products have soared in recent months as producers sought new markets to absorb the glut of crude oil. Total exports hit a record high of 4.9 million barrels a day in April.