Nowcasting Turns Big Unstructured Data into Valuable Market Insights

Traditional oil market analysis has often relied on applying classical statistical methods to historical data in order to identify possible patterns in the data that may have predictive power for relevant data points.

However, this approach has a key limitation. The ever-changing structure of oil markets makes the detection of these relationships a moving target.

Because of the availability of new high-frequency data sets in oil markets, the phrase “data is the new oil” is commonly heard. Nevertheless, just as crude oil needs to be processed in order to be consumed, this new data lacks value without the proper refinement. Properly refined, these new data sets can be leveraged to generate something more reliable than a forecast, a “nowcast.”

View the report here.