Every day, energy merchants collect and scrutinize whatever information they can find on fuel demand to get a trading edge: from satellite data tracking oil tankers worldwide to thermal images from cameras on pipelines and storage tanks.Been there:
Real-time data on fuel demand would be the ultimate prize.
On-the-spot gasoline consumption figures would change the way oil markets trade, because it is “the holy grail of metrics,” said Patrick DeHaan, head of petroleum analysis at GasBuddy.
A few weeks ago, the market thought it had found it. In mid-April, Apple Inc unveiled new data tracking human mobility trends, capturing user activity in searching for directions on smartphones.
The timing was perfect. Traders were chasing any clue to fathom the speed of recovery from the fastest and deepest collapse in fuel demand in history during coronavirus lockdowns. They relished the chance to incorporate mobility data into trading models.
But U.S. Memorial Day came, and the search data did not translate into activity. The U.S. Energy Information Administration (EIA) proxy for gasoline demand fell nearly 6% for the week including the holiday. Gasoline futures, which had rallied into Memorial Day, fell after the holiday that kicks off the U.S. summer driving season.
That disappointed traders, given roughly 70 percent of oil consumption worldwide is via vehicles, and as current data for retail demand generally looks either at the previous week or earlier periods. Several traders told Reuters on background that the discrepancy caused them to discount Apple’s index.
The sticking point, they said, was that Apple’s mobility data is based on search information rather than miles traveled. Matt Sallee, managing director of investment firm Tortoise Capital Advisors, said that data has not correlated as strongly to demand as other indexes.
Apple declined to comment. Settings for the iPhone include an option to limit notifications when the device perceives someone is driving, but it is unclear if Apple intends to use that data to enhance its mobility index.
Sallee said he was still using Apple’s figures, but combining them with other datapoints to make decisions as an energy-focused stock fund manager....MORE
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