Thailand’s lube demand showed signs of recovering in June, adding to a widespread pick-up in consumption throughout the Asia-Pacific market at the end of the second quarter.Firmer consumption throughout the region left blenders and refiners with lower stocks heading into the third quarter of the year, when demand usually faces a seasonal slowdown.Blenders and refiners’ balanced-to-tighter inventories supported steadier requirements for replenishment supplies, cushioning the impact of the slowdown in demand.Thailand’s lube consumption of close to 44,000 kilolitres (39,000 tonnes) in June edged down by 1% from year-earlier levels, government data showed..The contraction was the fourth in a row, but the smallest since consumption began to shrink from March.The volume was also up 19% from less than 37,000 kilolitres in May.The size of the increase was unusual.Thailand’s lube demand in the month of June is usually similar to consumption in the month of May.Demand improved on the back of a rise in consumption of heavy-duty engine oils and steadier consumption of industrial oils.Firmer consumption of industry-related lubricants coincided a rise in Thailand’s manufacturing purchasing managers’ index in June, as well as in July.Thailand’s firmer lube consumption coincided with a rise in Vietnam’s base oils and lube imports in June for the first time in four months.In northeast Asia, base oils and lube consumption in Japan and South Korea also rose strongly in June.Asia’s Group II base oils prices remained unusually firm relative to US export prices so far in the third quarter of the year.The firm prices complicated arbitrage opportunities to move any surplus base oils supplies to outlets like South America.The firm prices in turn pointed to more manageable supplies in Asia and the subsequent lack of any need to line up such arbitrage shipments.More manageable supplies could reflect the impact of the recovery in Asia’s lube consumption from the end of the second quarter.PTT Oil and Retail was Thailand’s largest lube supplier in June for a fourth straight month.PSP Specialties was the second-largest supplier for the second time in three months, with Shell Company of Thailand the third-largest..S Korea’s June base oils output falls.Japan’s June base oils supply lags demand.Asia base oils demand outlook: Week of 4 August.Thailand May base oil supply stays high
