US’ November base oils output falls

US base oils output fell to a one-year low in November as unexpected plant issues outweighed a boost in production following the completion of scheduled maintenance work.

The slump in output contrasted with and balanced out the arrival of a wave of base oils imports for the second time in three months.

Total supply duly fell in response at a time of year when the market often faces a build-up of surplus volumes.

Base oils and lube output of 4.42 million barrels (622,400 tonnes) in November fell from 5.08 million barrels the previous month, government data showed.

Output in October already fell from 5.11million barrels in September because of scheduled plant maintenance work in the US West coast.

Output fell more steeply in November from October even without any scheduled maintenance work.

The fall in output coincided with unscheduled production issues, lower base oils margins and a seasonal dip in demand in domestic and overseas markets.

The impact far outweighed the loss of production during the scheduled maintenance work in October.

Output fell in November mostly because of a slump in paraffinic base oils production in the Louisiana Gulf coast district to less than 1.25 million barrels.

The volume fell from more than 1.70 million barrels in October to the lowest in seventeen months.

Paraffinic base oils output in the Texas Gulf coast district also dipped in November to less than 1.38 million barrels.

The volume fell from more than 1.60 million barrels in October to the lowest in thirteen months.

Lower output balanced out another jump in US base oils imports in November.

Shipments of 1.71 million barrels rose from less than 1.10 million barrels in October to the second-highest level in twenty-five months.

The highest level during that time was in September.

Total supply, or output and imports combined, duly came to 6.13 million barrels in November.

The volume was almost the same as supply of 6.16 million barrels in October.

But the diverging output and import trends left imports accounting for 28% of total supply in November.

The share rose from 18% in October and a 21% share in the first ten months of last year.