Argentina’s lube demand fell in June for a fourth month from year-earlier levels, while lube production fell for a seventh month.The sustained drop in lube consumption and production added to signs of pressure on the country’s economic recovery and of blenders’ growing inclination to keep low stocks in response.A slump in base oils imports in June reinforced signs of blenders’ wariness about the outlook and preference to maintain low inventories.The drop in domestic demand coincided with weaker lube consumption in Brazil.That country’s base oils imports held firm in the second quarter of the year even with the drop in domestic demand.Any extension of the slowdown in demand raised the prospect of Brazil mirroring Argentina with a drop in requirements for base oils supplies from overseas markets.Argentina’s lube consumption of 18,400 cubic meters (16,300 tonnes) in June fell by 9% and for a fourth straight month from year-earlier levels, government data showed.Lube consumption fell even as the country’s automobile sales extended this year’s surge into the month of June, while annual inflation continued to slow..But Argentina’s economic activity shrank in May from the previous month for the second time in three months.Argentina’s falling lube consumption and output added to signs of a more mixed economic outlook.Weaker lube consumption and blenders’ preference to maintain low stocks cut demand for domestic and especially overseas feedstock supplies.Base oils imports fell to a multi-year low of less than 200 cubic meters in June, reflecting that dynamic.The pause in shipments left Argentina’s total base oils imports of less than 24,000 cubic meters in the first half of the year down by more than 40% from year-earlier levels.The US is Argentina and Latin America’s largest source of base oils supplies from overseas markets.Any sign of Argentina’s drop in imports extending to other markets in Latin America could put pressure on US suppliers to redirect more shipments to other regions. .Brazil’s June base oils supply stays high.Argentina’s May base oils supply rises.Latin America’s May lube demand rises.Base Oil News stories and analyses also available on the ICIS platform
