· US base oil demand likely to stay cautious amid persistent uncertainty about outlook for economy and costs.· Base oils prices hold steady even with lower feedstock prices in April 2025..· Lower feedstock prices raise concern about exposure to lower base oils prices, incentivizing buyers to hold back.· Steady prices could conversely ease those concerns and prompt buyers to resume procurement plans.· Steady prices and firmer base oils margins could also curb expectations of a rise in posted prices.· Expectations that prices are more likely to hold steady curb urgency to lock in additional volumes at current price levels.· Concern about slower lube demand and preference to maintain low stocks could complicate blenders’ strategy ahead of and during Atlantic hurricane season.· Concern about weather-related supply disruptions during that period typically prompts blenders to build additional stocks as a buffer.· Any such moves could be more muted this year because of concern about economic outlook.· Any moves to maintain lower stocks would leave market more exposed to impact of any weather-related supply disruptions..· Latin America’s base oils demand could face additional pressure from signs of more widespread slowdown in lube consumption.· Argentina’s lube demand falls in March 2025 for first time in three months and at steepest pace in five months..· Fall in lube demand contrasts with recent signs of economic recovery.· Fall in lube demand precedes US imposition of tariffs on most imports and subsequent expectations of slowdown in global economic growth.· Fall in lube demand and uncertainty about outlook could prompt blenders to pause any moves to replenish stocks and to instead keep low inventories.· Any such moves would cut domestic demand for overseas base oils supplies..· Argentina continues to tap tight global supply and firm overseas demand for Group I base oils, especially of heavy grades.· Argentina’s Group I base oils exports rise in March 2025 to highest in more than a decade..· Argentina’s shipments in Feb 2025 and March 2025 move to Nigeria.· Another large cargo loads from Argentina in H2 April 2025, with Nigeria a likely destination.· Dynamic likely to continue while global prices for Group I brightstock especially stay unusually high..· Brazil and Argentina’s firm domestic output and lower imports in recent months point to healthy or rising domestic demand for Group I base oils.· Trend contrasts with other markets where demand is rising more for premium-grade base oils..· Buyers in Africa markets like Nigeria turn increasingly to supplies from Americas rather than Europe to cover larger share of their requirements.· Markets like West Africa in turn provide valuable outlet for surplus supplies from Americas.· US accounts for more than 65% of global shipments to Nigeria in eight months to Feb 2025, up from 22% share in H1 2024 and 46% share in 2023..· US’ rising share of exports covers for drop in shipments from Europe, reflecting that market’s increasingly tight spot availability of Group I base oils.· Dynamic could face further change over coming year as new base oils production capacity starts to come online in various markets.· Additional supply could provide buyers in markets like West Africa with alternative supply options. .· Europe’s base oils demand likely to stay mixed.· Europe’s lube demand could continue to trend lower amid forecasts of weaker-than-expected economic growth.· Concern about weak demand, as well as more volatile feedstock prices in recent weeks, incentivize buyers to maintain lower stocks.· Buyers face challenge of balancing those concerns with meeting seasonal pick-up in demand.· Europe’s Group I base oils demand likely to get support from tight availability, boosting incentive to lock in volumes.· Firm Group I export prices relative to domestic prices point to sustained demand from overseas buyers despite tight availability and high prices.· Europe’s Group I base oils exports to markets outside the region slump in Feb 2025 from the previous month..· Lower exports highlight more limited spot availability to clear in Q1 2025, with trend extending into Q2 2025. · More limited spot availability forces overseas buyers to raise bid levels or seek supplies from other sources..· Europe’s Group II base oils demand could face pressure from competitive Group I and Group III prices, as well as signs of healthy availability of supply..· Healthy availability of supply gives buyers leverage to procure smaller volumes as and when required..· Base oils demand in Middle East could stay more muted.· Signs of sufficient base oils exports to Middle East in March 2025 follow surge in shipments to the region in Feb 2025..· Blenders’ replenished stocks curb urgency to seek additional volumes.· Volatile crude oil prices and expectations of improving supply in Asia add to incentive to hold back..Asia base oils demand outlook: Week of 28 April.Global base oils margins outlook: Week of 28 April.Global base oils arb outlook: Week of 28 April.Argentina’s March base oils/lube demand mixed
· US base oil demand likely to stay cautious amid persistent uncertainty about outlook for economy and costs.· Base oils prices hold steady even with lower feedstock prices in April 2025..· Lower feedstock prices raise concern about exposure to lower base oils prices, incentivizing buyers to hold back.· Steady prices could conversely ease those concerns and prompt buyers to resume procurement plans.· Steady prices and firmer base oils margins could also curb expectations of a rise in posted prices.· Expectations that prices are more likely to hold steady curb urgency to lock in additional volumes at current price levels.· Concern about slower lube demand and preference to maintain low stocks could complicate blenders’ strategy ahead of and during Atlantic hurricane season.· Concern about weather-related supply disruptions during that period typically prompts blenders to build additional stocks as a buffer.· Any such moves could be more muted this year because of concern about economic outlook.· Any moves to maintain lower stocks would leave market more exposed to impact of any weather-related supply disruptions..· Latin America’s base oils demand could face additional pressure from signs of more widespread slowdown in lube consumption.· Argentina’s lube demand falls in March 2025 for first time in three months and at steepest pace in five months..· Fall in lube demand contrasts with recent signs of economic recovery.· Fall in lube demand precedes US imposition of tariffs on most imports and subsequent expectations of slowdown in global economic growth.· Fall in lube demand and uncertainty about outlook could prompt blenders to pause any moves to replenish stocks and to instead keep low inventories.· Any such moves would cut domestic demand for overseas base oils supplies..· Argentina continues to tap tight global supply and firm overseas demand for Group I base oils, especially of heavy grades.· Argentina’s Group I base oils exports rise in March 2025 to highest in more than a decade..· Argentina’s shipments in Feb 2025 and March 2025 move to Nigeria.· Another large cargo loads from Argentina in H2 April 2025, with Nigeria a likely destination.· Dynamic likely to continue while global prices for Group I brightstock especially stay unusually high..· Brazil and Argentina’s firm domestic output and lower imports in recent months point to healthy or rising domestic demand for Group I base oils.· Trend contrasts with other markets where demand is rising more for premium-grade base oils..· Buyers in Africa markets like Nigeria turn increasingly to supplies from Americas rather than Europe to cover larger share of their requirements.· Markets like West Africa in turn provide valuable outlet for surplus supplies from Americas.· US accounts for more than 65% of global shipments to Nigeria in eight months to Feb 2025, up from 22% share in H1 2024 and 46% share in 2023..· US’ rising share of exports covers for drop in shipments from Europe, reflecting that market’s increasingly tight spot availability of Group I base oils.· Dynamic could face further change over coming year as new base oils production capacity starts to come online in various markets.· Additional supply could provide buyers in markets like West Africa with alternative supply options. .· Europe’s base oils demand likely to stay mixed.· Europe’s lube demand could continue to trend lower amid forecasts of weaker-than-expected economic growth.· Concern about weak demand, as well as more volatile feedstock prices in recent weeks, incentivize buyers to maintain lower stocks.· Buyers face challenge of balancing those concerns with meeting seasonal pick-up in demand.· Europe’s Group I base oils demand likely to get support from tight availability, boosting incentive to lock in volumes.· Firm Group I export prices relative to domestic prices point to sustained demand from overseas buyers despite tight availability and high prices.· Europe’s Group I base oils exports to markets outside the region slump in Feb 2025 from the previous month..· Lower exports highlight more limited spot availability to clear in Q1 2025, with trend extending into Q2 2025. · More limited spot availability forces overseas buyers to raise bid levels or seek supplies from other sources..· Europe’s Group II base oils demand could face pressure from competitive Group I and Group III prices, as well as signs of healthy availability of supply..· Healthy availability of supply gives buyers leverage to procure smaller volumes as and when required..· Base oils demand in Middle East could stay more muted.· Signs of sufficient base oils exports to Middle East in March 2025 follow surge in shipments to the region in Feb 2025..· Blenders’ replenished stocks curb urgency to seek additional volumes.· Volatile crude oil prices and expectations of improving supply in Asia add to incentive to hold back..Asia base oils demand outlook: Week of 28 April.Global base oils margins outlook: Week of 28 April.Global base oils arb outlook: Week of 28 April.Argentina’s March base oils/lube demand mixed
