Singapore’s base oils exports rose to a six-year high in the month to 18 March, boosting regional stocks and reducing the immediate impact of any subsequent supply disruption.

Total exports rose to 234,000 tonnes in the four weeks to 18 March, up from an already-high 217,000 tonnes the previous week and the highest since February 2020, Enterprise Singapore data showed.

Exports rose even as feedstock disruptions and surging diesel prices raised the prospect of a slowdown in shipments.

The elevated exports suggested that refiners had already secured sufficient feedstock to cover March base oils production plans.

Key Highlights

·         Domestic exports rose to the highest in at least five years, pointing to growing output from a new Group II base oils unit.   

·         Exports to China rose to the highest in three years, adding to already-plentiful domestic stocks.

·         Exports to Southeast Asia climbed to the highest in more than nine years, replenishing regional stocks ahead of the seasonal rise in demand.

·         Exports to India were the outlier, with a dip in shipments ending a three-week recovery.

·         Imports stayed low, with only steady flows from China limiting a deeper fall in inflows.

Market Repercussions

The rise in shipments to China and Southeast Asia over the past month boosted buyers’ inventories in those markets, leaving them better positioned to cover the seasonal demand peak in the coming weeks.

The elevated export volumes also pointed to Singapore's higher production capacity when feedstock supply and pricing conditions were more supportive.

Any subsequent drop in base oils run rates would complicate further stock-replenishment, especially in India, which largely missed out on the recent increase in shipments from markets such as Singapore.