Europe’s Group I base oils supply fell to a five-month low in November, compounding the tightening availability of the product throughout the year.Increasingly stringent lubricant specifications and firm prices relative to Group II base oils already incentivized blenders to use more premium-grade base oils in recent years.The sustained drop in Group I supply added to that incentive as blenders sought to ensure security of supply.The fall in supply in November extended the trend.It also coincided with a seasonal slowdown in demand and raised the prospect of curbing the size of a build-up of surplus Group I supplies late last year and early this year.Europe’s Group I base oils prices reflected that dynamic.The region’s Group I export prices fell sharply in January amid signs of a rise in surplus volumes, ICIS data showed.But domestic prices held firm relative to those export prices, suggesting that the export market was able to absorb most of the surplus supplies.Total supply of less than 120,000t in November fell from close to or more than 160,000t in each of the previous four months.Supply fell as base oils output halted in the UK and Turkey and fell sharply in Italy.The drop in volumes cut Europe’s Group I supply to around 1.78mn t in the first eleven months of the year.The volume fell by 8pc from more than 1.90mn t during the same period in 2022 to the lowest in more than five years..Europe’s Nov Group II supply stays low
Europe’s Group I base oils supply fell to a five-month low in November, compounding the tightening availability of the product throughout the year.Increasingly stringent lubricant specifications and firm prices relative to Group II base oils already incentivized blenders to use more premium-grade base oils in recent years.The sustained drop in Group I supply added to that incentive as blenders sought to ensure security of supply.The fall in supply in November extended the trend.It also coincided with a seasonal slowdown in demand and raised the prospect of curbing the size of a build-up of surplus Group I supplies late last year and early this year.Europe’s Group I base oils prices reflected that dynamic.The region’s Group I export prices fell sharply in January amid signs of a rise in surplus volumes, ICIS data showed.But domestic prices held firm relative to those export prices, suggesting that the export market was able to absorb most of the surplus supplies.Total supply of less than 120,000t in November fell from close to or more than 160,000t in each of the previous four months.Supply fell as base oils output halted in the UK and Turkey and fell sharply in Italy.The drop in volumes cut Europe’s Group I supply to around 1.78mn t in the first eleven months of the year.The volume fell by 8pc from more than 1.90mn t during the same period in 2022 to the lowest in more than five years..Europe’s Nov Group II supply stays low
