India’s imports of very-light grade base oils edged lower in March mostly because of a drop in shipments from Spain.Imports could face additional pressure over the coming months amid a narrowing premium of domestic retail diesel prices versus imported light-grade base oils prices.A wider diesel premium typically boosts the attraction of importing more light-grade base oils. A narrower diesel premium does the opposite.The country’s imports of 2cSt and 3cSt base oils fell to less than 100,000 tonnes in March, from close to 110,000 tonnes the previous month, provisional customs data showed.The drop in shipments contrasted with a rise in India’s Group II base oils imports in March and steady imports of Group III 4cSt and 8cSt base oils.Imports of very-light grades slowed mostly because of a dip in shipments from Spain to the lowest level in more than two years.Imports from Spain faced delays because the shipments now moved to India via southern Africa rather than the Suez Canal and Red Sea.A cargo that left Spain in second-half February was scheduled to reach India this week.Shipments from Spain to India previously took little more than a month.Imports from markets like South Korea could also face more pressure over the coming months if buyers targeted lower FOB Asia prices for shipments from those markets.Buyers faced a growing incentive to target lower prices after the premium of India’s retail diesel prices over imported prices for very-light grade base oils fell in April to its narrowest level in five months.The premium dipped following a fall in India’s retail diesel prices last month for the first time since mid-2022. The move coincided with a gradual rise in CFR India N70 base oil prices since the start of the year.Any downward pressure on FOB Asia cargo prices for very-light grade base oils could in turn incentivize refiners to redirect the supplies back into the diesel pool..India March base oil imports edge lower.India March Grp II/III imports stay lower
