Brazil’s base oils supply held steady in May as a pick-up in imports balanced out a drop in domestic output.Demand similarly held firm, leaving the supply surplus unusually narrow for a second month.The smaller surplus highlighted the impact of the sustained rise in Brazil’s lube demand throughout most of the past year.It highlighted signs of a growing reliance on base oil imports to cover that rise in demand.It also pointed a rise in requirements for premium-grade base oils to cover more of that demand.The trend raised the prospect of an extended rise in demand for overseas base oils supplies even when Brazil’s own base oils units were operating normally.Such a scenario would require domestic base oils prices that maintained levels that attracted a growing flow of shipments from overseas markets.Brazil’s total base oils supply, or domestic production and imports combined, came to 137,000 cubic meters (121,300 tonnes) in May, government data showed.The volume edged up from 134,700 cubic meters in April and from average volumes of 134,000 cubic meters/month over the past year.Supply held firm because of a rise in imports that had already remained unusually high since the second half of last year.The high imports at that time helped to cover for a drop in domestic base oils output because of a heavy round of plant maintenance in second-half 2023.Imports stayed high this year even with a rebound in base oils production since the start of the year.Total supply duly surged so far this year compared with year-earlier levels.But it barely exceeded demand in the months of April and May, when domestic lube demand extended its rise.The limited surplus kept pressure on the country’s domestic refineries to keep output at higher levels.It also raised the prospect of sustained demand for higher-than-usual volumes from overseas markets..Brazil’s May lube demand extends rise.Argentina’s May base oils supply falls
