Ithaca, NY – November, 22, 2016 – Ursa Space Systems Inc. in partnership with Blacklight Research has revealed economic trends and historical context for oil price shifts due to China’s influence.
Consistent and reliable data regarding oil stocks in China has been long desired to provide more insight on the country’s economic standing, as well as to give traders an idea of when China will fill their reserves to target and/or capacity levels. The only published data up to this point had been infrequent, but Ursa provides regular weekly reports using Synthetic Aperture Radar (SAR) satellite technology.
Not only does Ursa provide data, they release intuitive analyses for monitored locations, providing users a way to easily observe the significant trends that can be seen in the data. From Ursa’s method of providing insights, the company, in partnership with Blacklight Research, has shown that oil storage data provides a clear picture of events occurring in mid-2015, which led to the damage in financial markets at the beginning of 2016. At the time, analysts suspected that a recession was underway in China, but no one had the proof to know for sure.
This large shock to aggregate demand of oil in China “affected the performance of all asset classes and significantly altered the monetary policy plans of all major central banks”, says Colin Fenton, Managing Partner of Blacklight Research and former Global Head of Commodities for JP
Morgan. “A risk manager in possession of Ursa’s Ningbo crude oil data last summer would have been able to detect, quantify, and respond to the China demand shock in real time, ahead of the collapses in Chinese equity markets and other global markets”. Ursa provides that missing piece.
In the joint study between Ursa and Blacklight Research, they found that the historical data from Ningbo, China showed a capacity utilization increase from 73% in May 2015 to 83% in September 2015. This large 10%-point increase in a four-month period, coupled with publicly available import data for the same region, demonstrates a “large but unsurveyed drop in Chinese crude runs in the summer of 2015. We can also deduce from the Ursa data when crude runs recovered and by how much”, describes Blacklight Research.
Ursa is now reporting weekly results of 150 oil storage tank measurements in Ningbo, China, which they are calling the “Cushing, Oklahoma of China”. The full analysis alluded to above can be seen in a detailed three-page analysis which can be found here.
The analysis goes into detail about some of the applications of Ursa’s China Oil Storage Data. Ursa’s full data feed covers multiple locations across China, including Ningbo, Dalian, Tianjin, Lanshan, and Zhoushan and over 500 million barrels of storage capacity.