US base oils and lube supply rose to a seventeen-month high in March on the back of a simultaneous pick-up in domestic production and imports.Supply surged even as demand stayed muted and domestic base prices unusually weak relative to feedstock and competing fuel prices.The trend triggered a rise in surplus supplies and the need to clear an unusually large volume through the export market.US export prices were even weaker than domestic prices relative to feedstock and competing fuel prices.Lower margins typically incentivize refiners to cut rather than raise output.The rise in supply instead added to pressure on domestic base oils spot prices.US refiners raised posted prices in the month of March mostly in response to increasingly squeezed margins.US spot prices previously typically adjusted accordingly in response to changes in posted prices.Spot prices instead ignored the move this time. Their already-unusually-large discount to posted prices widened even further in response. US base oils and lube output of 5.12 million barrels (722,000 tonnes) in March rose from 4.85 million barrels in February, according to the EIA. The volume was the highest since mid-2022.Output got a boost from a rise in paraffinic base oils output in the US West Coast especially. Production in that region rose in March to a two-year-high of 400,000 barrels.A pick-up in base oils imports to the highest this year supplemented the rise in output and boosted total supply to 6.57 million barrels in March.Supply rose from 5.81 million barrels the previous month to the highest since late-2022..US’ February base oils supply falls
US base oils and lube supply rose to a seventeen-month high in March on the back of a simultaneous pick-up in domestic production and imports.Supply surged even as demand stayed muted and domestic base prices unusually weak relative to feedstock and competing fuel prices.The trend triggered a rise in surplus supplies and the need to clear an unusually large volume through the export market.US export prices were even weaker than domestic prices relative to feedstock and competing fuel prices.Lower margins typically incentivize refiners to cut rather than raise output.The rise in supply instead added to pressure on domestic base oils spot prices.US refiners raised posted prices in the month of March mostly in response to increasingly squeezed margins.US spot prices previously typically adjusted accordingly in response to changes in posted prices.Spot prices instead ignored the move this time. Their already-unusually-large discount to posted prices widened even further in response. US base oils and lube output of 5.12 million barrels (722,000 tonnes) in March rose from 4.85 million barrels in February, according to the EIA. The volume was the highest since mid-2022.Output got a boost from a rise in paraffinic base oils output in the US West Coast especially. Production in that region rose in March to a two-year-high of 400,000 barrels.A pick-up in base oils imports to the highest this year supplemented the rise in output and boosted total supply to 6.57 million barrels in March.Supply rose from 5.81 million barrels the previous month to the highest since late-2022..US’ February base oils supply falls
