INSIGHT
Base Oil Report
Europe European domestic Group I base oils spot prices were stable with limited activity taking place in mid-May. The market was stable-to-firm in H1 May, with supply constraints driving price increases in some regions. Group II availability was healthy, with 220N seeing downward pressure on prices as a result of ample imports. Group III spot values were stable with more spot volumes seen entering the European unapproved market from Asia. Europe export prices were unchanged due to a continued lack of either offers or bids. Sellers continue to prioritise the domestic market, with very little activity seen on the export market.
US
US domestic and spot export prices fell in mid-May amid continued signs of demand weakness and supply length. Spot volumes were available from both virgin and re-refiners, and prices continued to face downward pressure as expectations for a demand pickup faded. Term contract customers were generally paying a premium to the spot market. Group III was the outlier, with price stability and anticipation of tighter supplies with maintenance upcoming.
Asia
In mid-May, spot prices were steady to soft in Asia. Spot supply of Group I southeast Asia-origin cargoes continued to be limited, while demand remained lacklustre. In the Group II market, China import demand was muted amid softening domestic prices due to gradual output recovery from the restart of local refiner’s units from turnarounds. In India, buyers were non-committal in their purchases in anticipation of substantial volumes of US-origin Group II cargoes to be offered in the market in the near-term. Group III activity was limited amid muted offers from South Korea.
Samantha Wright, Senior Editor Manager
Middle East Spot Group I base oil prices in the Middle East were largely stable in mid-May. SN150 export offers were few, and traditionally limited demand for the grade mostly capped imports interest and discussions. Asian Group II imports into UAE remained capped by limited spot availability among a majority of northeast Asian refiners. The weakness in crude, combined with the prevailing bearish buying sentiments in the wider Asia market, has led to importers in the UAE remain cautious. Asian Group III 8cst cargoes were offered at prices slightly lower than those for regional product while availability of other grades stayed limited.
www.icis.com
LUBE MAGAZINE NO.175 JUNE 2023
57
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