Europe’s Group III base oils supply held in a narrow range in July for a fourth month even as weaker prices in other markets boosted the attraction of moving more shipments to the region.Total supply of more than 140,000 tonnes in July rose from less than 135,000 tonnes in May and in June, government and port data showed. It remained below supply of around 145,000 tonnes in April.Supply held in a 130,000-145,000 tonne/month range for a fourth month during a period when demand faced a seasonal rise during the second quarter and then a slowdown in consumption during the summer-holiday period.It stayed rangebound even as Europe’s Group III prices moved to an increasingly steep premium to prices in US and in Asia.The firmer prices incentivized overseas refiners in markets like the Middle East to target Europe with more supplies.There were some signs of such a move.Europe’s imports from Bahrain and the UAE combined climbed to a nine-month high in July, while shipments from Asia rose to the highest in more than a year. A dip in supplies from Spain and Qatar balanced out the pick-up in shipments from those markets.Europe’s steady supply contrasted with a rebound in US Group III base oils imports in June and July.US imports rose despite that market’s weaker prices, muted demand and rising domestic production of Group III base oils.The dynamic suggested that overseas suppliers continued to prioritise market share in the US even if at the expense of lower prices, at least in the short term.The US market’s proximity to other outlets like Mexico could be another attraction.Either way, Europe’s steadier Group III base oils supply curbed any additional pressure on the region’s prices.The pick-up in US supplies by contrast raised the prospect of prices in that market facing more pressure for longer.
