US’ March base oil imports fall

US base oil imports fell in March to a one-year low amid a slump in shipments from the Mideast Gulf.

Total imports of 985,850bl in March fell by 35pc from 1.51mn bl the previous month to the lowest in a year, government data showed.

The slowdown mostly reflected a dearth of supplies from Qatar in March for the first time in five months. There were also no supplies from Bahrain for the first time in eight months.

US Group III base oil prices have risen more slowly than Group I and Group II prices in recent months. The more muted price increase reflected the product’s more plentiful availability compared with those other grades.

That trend was repeating itself in other major markets, so curbed any attraction of moving more supplies to those other markets.

Even as they have risen more slowly, Group III prices remained at a steep premium to crude and diesel prices. The premium provided less incentive for refiners to tweak output to produce more diesel instead.

Rather, the slowdown in shipments to the US likely reflected other factors such as plant maintenance work.

Even with the slowdown in March, US base oil imports of 3.67mn bl in the first three months of the year remained at healthy levels. US prices also suggested fundamentals remained steady.