Even though oil production inside the United States has declined over the summer, it’s as if oil supply is all that continues to matter. With oil prices down significantly today, as well as since mid-October, the incessant appeal of oil supply blooms yet further even though there is so much more than that to take into account. If prices fall as they have, you find nothing but “overhang” and “glut”, but when they rise it is far more of the perky and hopeful variety. This isn’t to say that oil supply is unimportant or unrelated, only that oil is clearly far more than thatbeing especially driven financially.

“It continues to show excess (supply) in the market in this quarter and going forward … it’s only really in the last quarter of next year when we could potentially see some rebalancing of the market,” Natixis commodity strategist Abhishek Deshpande said.

“What markets don’t tend to realise is the overhang of crude, which has been developing since September last year, will go into the end of next year,” he said.

U.S. production cuts — from a peak of around 9.6 million barrels a day to around 9.1 million — and optimism over demand have failed to translate into higher prices, said Ric Spooner, chief market analyst at Sydney’s CMC Markets.

If lower actual supply and “optimism over demand” aren’t pushing the great expected rebound, then that leaves oil commentary in the same place as economic commentary looking for transactions and activity that just aren’t there; nor likely to be. In other words, “optimism over demand” is very different than actual demand, a dichotomy as old as this “recovery” but with quite renewed emphasis about 2015. As noted last week, oil stocks (inventory) are rising again, along with distillates, even though stocks remain close to record levels (almost a third greater than a year ago). That strikes directly against consistency: