Global supply and demand stats may help to explain pricing. Data...

Global supply and demand stats may help to explain pricing. Data from the International Energy Agency shows some interesting things.

Things to note:

- Every quarter since mid 2010 demand has exceeded 88 MBPD and in all periods except one has exceeded 89 MBPD.

- In only two period has supply exceeded 88 MBPD and never reached 89 MBPD.

- In other words demand have exceeded supply on a global basis for the last year. The difference has been coming from reserve stockpiles.

- Supply has never reached significantly more than 88 MBPD but projected demand in coming months exceeds 90 MBPD.

- If supply doesn't increase shortly, and you will note that it has recenly fallen, then the drawdown on strategic reserves could be somewhere between 700 MBPY and 1.4 billion barrels. Strategic reserves cannot fill such a large shortfall so prices will have to rise again to curtail demand.