Europe’s imports of premium-grade base oils from the Mideast Gulf stayed low in December, coinciding with a seasonal slowdown in lube demand.Imports from the Mideast Gulf showed signs of recovering in January following the completion of plant maintenance work in the region during the fourth quarter of the year.The pick-up in supplies should partially cushion the impact of a slowdown in premium-grade base oils shipments from Asia-Pacific to Europe at the start of the year..S. Korea’s Jan exports to Europe slump.Europe’s premium-grade base oils imports from Bahrain and UAE combined came to less than 5,000t in December, EU government data showed.The volume fell from a revised 23,250t the previous month to the lowest since mid-2020.The drop in supplies cut Europe’s total base oils imports from the two Mideast Gulf countries to less than 225,000t in 2022. The volume was down 28pc from almost 310,000t in 2021..Supplies fell even as Europe’s Group III base oils demand held firm, especially relative to Group I and Group II base oils.A rise in premium-grade base oils output from Spain last year plugged most of the gap. The supplies also increased the importance of Spain as the key source for Europe’s Group III base oils.The diverging flows to Europe from different sources kept the region's total supply relatively tight. The strong fundamentals supported firm Group III prices relative to other grades.More supplies from the Mideast Gulf moved to the US instead, especially during the second half of the year.Firm US demand and high prices attracted more shipments.The US’ limited domestic Group III base oils production capacity also meant imports had to keep increasing to cover its rising demand for premium-grade base oils.US imports of premium-grade base oils from UAE and Bahrain combined came to almost 180,000t in the second half of last year. The volume rose from around 157,000t during the first six months of the year.An ongoing rise in Group III shipments to the US from the Mideast Gulf raised the prospect of increasingly tighter supplies bound for Europe..US’ December base oils imports recover.Base Oil News stories and analysis also available on ICIS platform
