South Korea’s base oils output recovered in July but was still the second-lowest in more than two years.

Base oils output of 2.36mn bl (332,110t) in July rose from 1.87mn bl the previous month, according to Korea Petroleum Association.

The June volume was the lowest since early 2021. The July volume was the second-lowest since then.

Output fell in June because of the shutdown of a key Group III base oils plant in South Korea for scheduled maintenance work.

Output recovered in July following the restart of the base oils unit.

The country’s base oils output could struggle to return to levels before June amid refinery run-cuts in August.

Sliding base oils margins in recent months incentivized refiners to extend the run-cuts.

The premium of regional Group II base oils prices over gasoil slumped to a six-month low in July, ICIS data showed.

The premium then flipped to a discount to gasoil in August for the first time in more than a year.