US base oils exports rebounded to a six-month high in January, helping to clear a surge in stocks at the end of last year.Base oils prices faced downward pressure in the US and Europe at the start of the year as weak demand magnified the impact of the availability of surplus supplies in every major market.The rise in shipments from the US in January added to those supplies.Base oils exports of almost 1.90mn bl (266,000t) in January rose from a nine-year low of little more than 1mn bl in December, government data showed..Base oils exports rose 3pc from year-earlier levels to the highest since last July amid a rebound in shipments from the districts of San Francisco and Mobile in Alabama.The pick-up in shipments from the US was likely to reverse a surge in the country’s base oils and lube stocks at the end of last year.Those stocks rose to a 31-month high in December partly because of a slump in US base oils exports..US’ Dec base oils/lube demand falls.Lower prices to clear the supplies also boosted refiners’ incentive to cut output and prioritise production of other products like middle distillates.The start of another round of plant maintenance work in the US from second-half January was set to trim output further.The clear-out of the supplies through the export market added to pressure on base oils prices at the start of the year.More balanced stocks following the clear-out would ease that price pressure.The speed of the rise in base oil and lube stocks at end-2022 highlighted the impact of surplus supply when the arbitrages are shut, and the subsequent pressure on prices.It also highlighted the attraction of keeping those arbitrages open to avoid such a supply-build..US’ Dec base oils/lube output rises
US base oils exports rebounded to a six-month high in January, helping to clear a surge in stocks at the end of last year.Base oils prices faced downward pressure in the US and Europe at the start of the year as weak demand magnified the impact of the availability of surplus supplies in every major market.The rise in shipments from the US in January added to those supplies.Base oils exports of almost 1.90mn bl (266,000t) in January rose from a nine-year low of little more than 1mn bl in December, government data showed..Base oils exports rose 3pc from year-earlier levels to the highest since last July amid a rebound in shipments from the districts of San Francisco and Mobile in Alabama.The pick-up in shipments from the US was likely to reverse a surge in the country’s base oils and lube stocks at the end of last year.Those stocks rose to a 31-month high in December partly because of a slump in US base oils exports..US’ Dec base oils/lube demand falls.Lower prices to clear the supplies also boosted refiners’ incentive to cut output and prioritise production of other products like middle distillates.The start of another round of plant maintenance work in the US from second-half January was set to trim output further.The clear-out of the supplies through the export market added to pressure on base oils prices at the start of the year.More balanced stocks following the clear-out would ease that price pressure.The speed of the rise in base oil and lube stocks at end-2022 highlighted the impact of surplus supply when the arbitrages are shut, and the subsequent pressure on prices.It also highlighted the attraction of keeping those arbitrages open to avoid such a supply-build..US’ Dec base oils/lube output rises
