Europe’s Jan Group III imports from Mideast Gulf fall

Europe’s imports of premium-grade base oils from the Mideast Gulf fell to an eight-month low in January, more than countering a seasonal slowdown in regional demand.

Europe’s Group I and Group II base oils prices extended their slide in the first two months of this year as weak demand complicated moves to clear lingering surplus supplies.

The region’s Group III prices held much firmer in response to tight supply fundamentals. Their premium to Group I and Group II prices widened sharply in response.

Imports of premium-grade base oils from the Mideast Gulf showed signs of improving in March especially.

Any such improvement in supplies could put pressure on the unusually wide gap between Europe’s Group III prices and Group I and Group II prices.

The region’s premium-grade base oils imports from Bahrain and UAE combined came to little more than 15,000t in January, EU government data showed.

There were also no cargo imports from Qatar in January for the first time in eight months.

The combined volume from the three markets fell from more than 27,000t in December to the lowest since May 2022.

Imports of little more than 42,000t in December and January combined fell from more than 86,000t during the previous two months.

Europe’s lubricating oil consumption fell sharply late last year in response to a seasonal and economic slowdown.

The slowdown was still much less steep than the slump in shipments from the Mideast Gulf.

Demand showed signs of a seasonal recovery at the beginning of this year.

Imports from the Mideast Gulf showed no such revival.

US premium-grade base oils imports from the Mideast Gulf also fell in January from the previous month. But they remained high.

US imports of more than 160,000t from the Mideast Gulf in December and January combined rose from less than 107,000t during the previous two months.

The volume showed signs of exceeding demand, with US Group III prices falling in response.