Energy Information Administration (EIA), Department of Energy (DOE).
Request for General Comments.
EIA is seeking general comments on matters described below in support of the Energy and Financial Markets Initiative announced on September 9, 2009.
Comments from interested parties are requested to be received by close of business on March 29, 2010.
Send comments to ensure receipt of the comments by the due date, submission, preferably as a Word attachment to an e-mail to (email@example.com), or by FAX (202-586-3873). The mailing address is Office of Oil and Gas, EI-40, Forrestal Building, U.S. Department of Energy, 1000 Independence Ave., SW., Washington, DC 20585. Alternatively, Karen R. Robinson may be contacted by telephone at (202) 586-2585.Start Further Info
FOR FURTHER INFORMATION CONTACT:
Requests for additional information should be directed to Karen Robinson at the address listed above.End Further Info End Preamble Start Supplemental Information
II. Current Actions
III. Request for Comments
The U.S. Energy Information Administration (EIA) is the statistical and analytical agency within the U.S. Department of Energy. EIA collects, analyzes, and disseminates independent and impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment. EIA is the Nation's premier source of energy information and, by law, its data, analyses, and forecasts are independent of approval by any other officer or employee of the United States Government.
The Federal Energy Administration Act of 1974 as amended, specifically 15 U.S.C. 790a, and the DOE Organization Act, specifically 42 U.S.C. 7135, require EIA to carry out a centralized, comprehensive, and unified energy information program. This program collects, evaluates, assembles, analyzes, and disseminates information on energy resource reserves, production, demand, technology, and related economic and statistical information. This information is used to assess the adequacy of energy resources to meet near and longer term domestic demands and to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment.
The present notice focuses on information needed to support analysis and increased understanding of energy markets and does not itself propose any new information collection by EIA. The general comments received in response to this notice will be considered by the agency as it develops a plan of action to fill key information gaps.
EIA evaluates its activities on an ongoing basis through a variety of formal and informal methods. EIA provides opportunities for interested parties to shape its functions and practices through its annual conference, joint meetings with the American Statistical Association, meetings with experts, and other outreach opportunities. EIA also tracks its website metrics and formal citations of its data and analyses to measure interest in the information it provides.
The EIA Web site at http://www.eia.gov is the principal method for dissemination of its energy industry information. One of the Web site pages, http://www.eia.doe.gov/bookshelf.html, provides a list of weekly, monthly and annual reports and special analyses, and another page, http://www.eia.doe.gov/oss/forms.html, lists over 64 active data surveys and forms used to collect these data. During fiscal year 2009, EIA Web pages were viewed over 10 million times per month, reflecting both searches for information and cataloging of sites by search engines. A recent survey indicated that about half of EIA visitors are commercial, and many indicate that they use information from EIA and other Web sites to meet their needs. Many customers are regular users of EIA data; nearly half of the respondents to the survey indicated that they visited the Web site weekly or more frequently.
In recent years, energy markets have developed in ways that were not anticipated in the original planning and evolution of EIA's information program. In addition to the factors EIA has historically tracked, such as production, consumption, inventories, and spare capacity, moving forward, EIA is interested in assessing other market influences, such as speculation, hedging, investment, interest rates and exchange rates. On September 9, 2009, EIA announced an Energy and Financial Markets Initiative to improve EIA's responsiveness, in particular, to energy market developments (http://www.eia.doe.gov/neic/press/press325.html). Proposed actions were announced in four main areas, including identification of critical information on factors affecting energy prices and analysis through in-depth studies of energy market behavior. Other efforts included coordination with other Federal agencies engaged in energy market information collection and analysis and outreach to solicit feedback from a broad range of experts on the interrelationship of energy and financial markets.
In its September 2009 announcement, EIA pointed out that it already collects significant energy information, but that additional data would further improve market transparency. EIA has already proposed to expand its collection of commercial oil and refined products storage capacity data beginning in early 2010. The Federal Register notice for this collection can be found at http://edocket.access.gpo.gov/2009/pdf/E9-26319.pdf. EIA has moved toward a broader analysis of market factors through a characterization of oil and natural gas market volatility in the Short-Term Energy Outlook (STEO). EIA now calculates an “implied volatility” for oil and natural gas futures prices using a generally accepted mathematical model, as described in the technical report accompanying the STEO entitled Energy Price Volatility and Forecast Uncertainty (at http://www.eia.doe.gov/Start Printed Page 4361emeu/steo/pub/special/2009_sp_05.html). This implied volatility is used to generate confidence intervals around futures prices, allowing readers to understand the degree of uncertainty surrounding current and future expected prices.
II. Current Actions
EIA is currently considering the state of its statistical data collecting and analysis activities, which include:
- Identifying the best data for understanding relationships among physical inventories, energy prices, and market activity, as well as identifying what other data is important to better understand energy price movements.
- Identifying what market data EIA might seek from other Federal agencies, including from the Commodity Futures Trading Commission (CFTC), and from other sources to analyze the influence of futures and related financial market activity on energy prices in the context of other energy market factors.
- Providing a comprehensive assessment, over the next year, of remaining energy information gaps in physical and financial markets, and developing a strategy to fill them.
EIA is not proposing specific changes in its data collection program in this notice.
A. Energy Market Data Needs
Recent energy price volatility and the international economic issues posed by recent financial institution distress have focused interest on the interrelations between physical energy markets and activities in futures and financial markets. Growth in trade of energy commodities has occurred not only on exchanges overseen by the CFTC, but increasingly in derivatives traded over-the-counter (OTC) and in energy-backed securities, neither of which have been historically overseen by the CFTC. During 2009, the CFTC held hearings on the effects of OTC trade in energy and other commodities, and Congress has considered proposals to change the organization and authorities for oversight of such markets. On January 14, 2010, the CFTC approved a notice of proposed rulemaking that would establish additional position limits on certain energy markets.
Unlike other Federal entities that currently collect market data, including the CFTC, the Federal Energy Regulatory Commission (FERC) and the Securities and Exchange Commission (SEC), EIA is not a regulatory agency. EIA uses the energy information it collects exclusively for statistical purposes to understand and assess energy market conditions. EIA's role in informing decision makers and the broader public regarding energy market developments could be strengthened by the availability of current and historical information about these related financial market practices.
In support of the above, EIA is considering the following topics:
- Identifying information associated with energy market behavior that is most needed to support analysis and increased understanding of energy markets; This might include:
○ Identifying all oil inventories and other physical oil assets, including all petroleum-based products and the storage of such products in offshore tankers, that are owned by the 50 largest traders of oil contracts including derivatives contracts;
○ Other physical market data;
○ Identifying information on energy-related futures and options traded on exchanges;
○ Identifying information on behavior in the OTC market for physical delivery of energy commodities in spot and term markets;
○ Identifying information on behavior in the OTC market for financially-settled swaps, options and other energy derivatives; or
○ Other financial market data.
- Determining the appropriate level of aggregation (ranging from transaction-level data to highly aggregated data) and the appropriate data frequency.
- To the extent historical information might be important for interpreting current market dynamics information, determining the historical time period EIA should consider in acquiring additional information.
- Determining what would be a useful series of recurring data and analysis reports that EIA could produce.
B. Energy Market Data Sources
Given the public interest in assuring that EIA's information collection activities do not impose an undue burden, EIA is presently considering whether and to what extent it can obtain data from other sources, including:
- Other Federal entities that EIA should incorporate into its analyses of energy prices;
- Non-governmental sources that could help EIA and its customers better understand, analyze and explain the effects of market behavior on energy prices without requiring additional survey data collection efforts;
- Other Federal entities or other sources that EIA should collect to inform policymakers, market participants, and the public about energy market behavior and prices; and
- Information-gathering methods that EIA should use to become informed of participants entering or leaving the market(s), in order to manage its survey samples.
C. Timing and Frequency of Existing EIA Energy Data Releases
EIA produces many weekly, monthly, and annual reports on energy marketing and operations. In each case, there are time lags between the “as of” date of the information and the publication of the reports. The delay arises from the time needed for data collection, verification of collected data, follow-up with respondents to make clarifications, imputation of missing data, generation of aggregate values from the survey sample, and analysis of aggregate data. The total time for any given report depends on the effort required to perform these tasks and to achieve data quality standards.
EIA monitors and publishes information regarding adherence to its schedules, and has typically achieved a 95 percent or better success rate against its schedule. However, a recent EIA customer survey indicated that some customers would appreciate acceleration of some releases. EIA is considering:
- For energy information already being collected and disseminated, an acceleration or increased frequency of existing schedules;
- Any consequences to changing time lags in the EIA dissemination process given the availability of information from other sources, some of which require paid subscriptions; and
- Priorities for EIA in allocating limited resources among additional information, more frequent information, and more timely information.
D. Specific Types of Crude Oil
Recently, discussion of energy price behavior has raised several specific issues regarding the non-homogeneous nature of oil as a commodity. Different types of crude oil are produced in different geographical areas, have variations in chemical content, and are therefore sold at different prices. For example, the relative supply of crudes of different qualities can interact with existing refinery capacity, environmental regulations and refinery investment patterns to influence prices. When prices of major benchmark crude types, such as West Texas Intermediate (WTI), change, prices also change for other crudes and, in some cases, financial instruments linked to such benchmarks.
EIA collects crude quality data in regard to import quantities and prices, but does not collect or analyze other aspects of the crude oil market in terms Start Printed Page 4362of crude oil quality. Regarding acquisitions, Form EIA-856, “Monthly Foreign Crude Oil Acquisition Report,” seeks the FOB, landed costs and other features of crude oil acquisition, including crude oil type and quality. Firms importing 500,000 barrels or more in a reporting month are asked to identify the generic crude oil quality stream for each purchase, selecting from a list of several hundred options. (See Appendix A at http://www.eia.doe.gov/pub/oil_gas/petroleum/survey_forms/eia856i.pdf.) In addition, importers are asked to provide the API gravity of specific shipments. Current EIA reports derived from this information are typically limited to aggregations by country of origin and average prices for different levels of API gravity.
Customers of EIA analyses might benefit from a more detailed treatment of crude quality differentials as a factor affecting market dynamics. EIA is therefore considering what, if any, additional types of information it should collect, analyze, and disseminate on the pricing, landed costs, inventory, and supply levels of different types of crude oil.
III. Request for General Comments
General comments submitted in response to this notice will be considered and utilized to develop a plan of action.Start Signature
Issued in Washington, DC, January 20, 2010.
Howard K. Gruenspecht,
Deputy Administrator, Energy Information Administration.
[FR Doc. 2010-1663 Filed 1-26-10; 8:45 am]
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