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Base oils exports rebounded to a five-month high in March, delaying the impact of supply disruptions into the second quarter
The rebound masked a shift in shipment destinations, pointing to a faster impact on trade flows than on total volumes
Feedstock disruptions and rising diesel margins pointed to a slowdown in export volumes in the coming months
South Korea’s base oils exports rebounded to a five-month high in March, mirroring gains among other Asian producers and highlighting the lagging effect of end-February supply disruptions on previously-arranged shipments.
Total exports rose to 390,000 tonnes in March, rebounding from a thirteen-month low of 322,000 tonnes in February and lifting first-quarter shipments to a two-year high, Korea Customs Service data showed.
The increase in March exports from producers such as South Korea and Taiwan helped cover a seasonal rise in regional demand at the end of the first quarter. The volume also reflected the muted impact of disruptions on cargoes arranged before March.
Key Highlights
· March exports were the second-highest in seventeen months and up from typical monthly levels of less than 345,000 tonnes in 2025.
· Exports to Southeast Asia recovered to more than 71,000 tonnes, up from a seventeen-month low of less than 60,000 tonnes in February and closer to more typical levels.
· Exports of more than 77,000 tonnes to Northeast Asia remained well above typical levels of around 67,000 tonnes/month in 2025.
· First-quarter exports rose to 1.08 million tonnes, up 10% year on year to the highest since the beginning of 2024.
Market Repercussions
South Korea’s higher first-quarter exports reflected Asia’s earlier challenge of managing an expected increase in supply.
The challenge has since shifted to security of supply as feedstock disruptions and surging diesel margins prompted refiners to prioritise motor fuels output.
The rebound in March exports deferred the visible impact of those constraints into the second quarter.
But the rise in total flows already masked a shift in shipment destinations, mirroring a similar pattern in Taiwan and pointing to a more immediate impact of disruptions on trade flows than on overall volumes.
The delayed impact on export volumes was likely to become more apparent in the coming months as previously-arranged cargoes were completed and feedstock constraints began to weigh on refinery run rates.
