Europe’s Group I base oils exports to non-EU markets rose to a six-month high in July amid a surge in shipments from Italy and the UK.The rebound in shipments pointed either to a pick-up in supply or a slowdown in regional demand.Base oils exports of more than 78,000 tonnes in July rose from less than 48,000 tonnes in June and by 78% from year-earlier levels, government data showed.The rise in exports from year-earlier levels was the first since January.The shipments originated from Greece, Hungary, Italy, Poland and UK. Europe’s Group I base oils exports to markets within the region rose by more than 25% in the first half of the year.The rise in shipments contrasted with a 24% fall in exports to markets outside the region during the same period.The pick-up in shipments to non-EU markets in July ended that trend.The rise in exports to markets outside the region mostly reflected a surge in shipments from Italy.The country’s exports to non-EU markets rose to a six-month high in July amid large shipments to north Africa and especially to southeast Asia.Italy’s base oils production capacity fell sharply earlier this year following the closure of one its two virgin Group I base oils plants.The lower capacity and production suggested a change in regional demand was likely a key determinant behind the surge in shipments.Exports rose at a time of year when Europe’s base oils demand typically slows ahead of and during the summer holidays.A sustained fall in the region’s lube demand showed signs of extending through that period.Shrinking lube consumption magnified the impact of the seasonal dip in demand.Improved availability of premium-grade base oils also curbed blenders’ need to turn to Group I supplies to cover their requirements.The dynamic cut further the region’s requirements for Group I base oils, freeing up more supplies for overseas markets..Italy’s July base oils output holds steady .Global base oils arb outlook: Week of 23 Sept.Europe’s June Grp I exports extend fall.Europe’s July lube demand improves
