US base oils demand fell to a twenty-one month low in November amid a seasonal slowdown in domestic and overseas consumption.The predictable slowdown in demand increased the importance of lower supply to avoid a large build-up of surplus volumes at the end of the year.Supply duly dipped to a three-month low amid a drop in domestic base oils output to its lowest level in a year.Signs of a slowdown in US base oils imports in December raised the prospect of supply holding at lower levels during the final weeks of the year.Such a dynamic would cushion the impact of the ongoing seasonal dip in consumption at year-end and limit the size of any overhang of surplus volumes carried into the start of this year.Domestic base oils and lube consumption of 1.67 million barrels (235,000 tonnes) in November fell from 2.66 million barrels the previous month to the lowest since end-2023, government data showed.Demand was slightly higher than year-earlier levels. But it remained well below consumption volumes of more than 3 million barrels in the month of November during the decade to 2022.The slump in demand increased pressure on US base oils exports to hold at elevated levels to compensate for the lower domestic volumes. Base oils and lube exports of 3.81 million barrels in November remained close to typical, higher levels over the past year.But they were down from more than 4.0 million barrels in October and by 8% from year-earlier levels.Total demand, or domestic consumption and exports combined, duly fell to less than 5.50 million barrels in November.The volume dropped from more than 6.70 million barrels the previous month to the lowest since the beginning of 2023.The surplus of supply over demand duly rose. But lower supply cut the size of the surplus to less than 650,000 barrels.The surplus reversed a 566,000-barrel shortfall the previous month, leaving stocks relatively balanced in the first two months of the fourth quarter..US’ November base oils output falls.US’ Nov base oils exports to Europe rise
