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Imports rose to a 16-month high, with the Middle East accounting for 55% of US Group III inflows
War-related disruption pointed to a marked drop in April arrivals, with Qatar's absence removing a key buffer
Alternative suppliers such as South Korea and Canada would struggle to fully offset a gap left by sources that accounted for over half of January imports
US base oils imports rebounded to a sixteen-month high in January, boosting stocks ahead of a pause in Middle East shipments from late February that raised the prospect of tighter Group III availability.
Total imports, consisting mostly of Group III base oils, rose to 1.81 million barrels (255,000 tonnes) in January, up from 1.50 million barrels in December and 18% higher than year-earlier levels, Census Bureau data showed.
The recovery in imports in December and January coincided with a seasonal slowdown in winter demand, pointing to a build-up in surplus volumes at the start of the year.
That surplus now took on greater significance, with any pressure from oversupply giving way to concern about tighter availability as war in the Middle East triggered a pause in flows from the region’s Group III producers.
Key Highlights
· Middle East suppliers accounted for 55% of US Group III inflows in January, well above the 44% share in 2025.
· Shipments from Qatar rose to a five-month high, accounting for more than 50% of total Group III shipments from the Middle East and more than a quarter of total US Group III imports.
· Imports from South Korea held in a narrow range but extended their year-on-year fall for the sixth time in seven months.
· Imports from Canada extended their surge, rising year on year for the thirteenth time in fourteen months and accounting for more than 20% of total US imports.
Market Repercussions
Flows from the Middle East showed signs of slowing in February before surging in March as regular shipments that loaded in recent months continued to arrive.
A more marked drop in arrivals was expected in April, reflecting the pause in shipments from late February.
A similar slump in shipments from the Middle East in July last year coincided with a gradual recovery in US Group III base oils prices relative to Group II grades.
The July slowdown coincided with scheduled Group III plant maintenance in Bahrain and the UAE, announced well in advance.
Stock-building ahead of the shutdowns and steady flows from Qatar partially cushioned the impact.
The current pause included Qatar, removing that buffer.
The stoppage gave other suppliers such as South Korea the opportunity to boost their share of the US market.
But even a sustained pick-up in volumes from alternative sources would be insufficient to replace supply that accounted for more than half of US Group III imports in January.
