KSA consumption puzzle Pt II

(edited)

Can't let go of the consumption puzzle ,sorry guys, just trying to understand some data ;).

Assume the following formula: Consumption = Production - Exports - Stock Change and consider the attached chart (3 month average to add some smoothness).

Why did consumption jump at the start of 2016 so dramatically? Is consumption really much higher as the official numbers suggest?

Don't know what to make out of this chart..

-Simon

PS: Either the formula or the data must be way off too. Can't explain the chopping around and persistent negative values.

ksa consumption.png

Edited by Simon Hauser
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Saudi Arabia ramped up oil production big time early 2016 along with other OPEC nations in an attempt to put US shale out of business.  I can imagine doing such a thing as that, working to bring those less productive oil fields back online, might consume a lot of extra oil.  This is just a guess though.  I also don't know how much energy is consumed by operating an oil field at max capacity vs. what would be needed to maintain it while it is not operating.  I suppose we could try to check this theory by looking to see if Russia and Iran's oil production also increased in early 2016 when they too ramped up production. 

As far as the 2011 and early 2012 spike/dip...maybe the protests from the Arab Spring had an effect on Saudi consumption, or more likely, maybe the protests from around the world affected supply, driving up price.  It is possible the Saudis ramped up production at that time to compensate/profit from the higher oil prices.  

Remember, my theory is that during the ramp up process, you would consume a lot of oil without actually producing much additional oil (since there is a bit of lag before you can get an oil field running at max capacity), and then after the fields are up and running, you would consume more oil than before but less than during the ramp up process, which seems to be what we see in the 2017-2018 section of your chart.  Since oil production is such as large part of the Saudi economy, I would imagine that oil production increases/decreases would result in move visible moves up and down in the Saudi chart than in some other oil producing economies.  

But then again, this is just a guess.  

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