US base oils supply rose to a three-year high in September on the back of higher domestic output and a surge in imports.The rise in supply highlighted the persistent risk and speed of a sharp build-up of surplus volumes, especially during the final months of the year when demand faced a seasonal slowdown.A drop in US domestic and export spot prices and in US refiners’ posted prices from first-half September pointed to moves to slow or avert such an outcome.Supply rose as domestic base oils and lube output climbed to 5.11 million barrels (719,000 tonnes) in September, government data showed.Output rose for an eighth month from year-earlier levels to the highest since March.Supply got a further boost from a surge in US base oils imports to 2.06 million barrels in September.The volume almost doubled from the previous month to the highest in almost two years.Total supply, or output and imports combined, duly rose to 7.17 million barrels in September.The volume was the highest since August 2021.The surge in supply reflected more the rise in imports than the pick-up in domestic output.The dynamic complicated the ability for US refiners to manage the pick-up in supply.Lower domestic and export base oils prices had more impact and influence on domestic output and exports than on imports.US base oils imports by contrast surged even with US Group III base oils prices at steep discounts to prices in Europe and in Asia in the third quarter of the year.Even so, the surge in imports added to the importance for US refiners to maintain high export volumes, especially as domestic demand waned during the fourth quarter.More competitive Group II prices relative to Group III prices could also reduce further the attraction of shipping more Group III base oils to the US.Plant maintenance in October likely cut output during that month, curbing supply.But the US market faced the prospect of a similar pick-up in supply in the month of November, with plant maintenance completed and a another wave of shipments moving to the country..Latin America Sept lube demand falls.US’ August base oils supply falls.S Korea’s Aug base oils exports rise to US, Europe
