Europe’s Group III base oils supply held in a narrow range in June for a fourth month as a surge in shipments from the Middle East balanced out a drop in supplies from Spain and Asia.Europe’s steady Group III supply, and more volatile flows from the markets supplying the region, highlighted the benefit of multiple sources for those supplies.The large number of different sources helped to cushion the impact of a drop in supply from any one of those sources because of factors like plant-maintenance or logistical issues.Europe’s Group III base oils supply came to more than 135,000 tonnes in June, government and port data showed..The volume fell only slightly from more than 140,000 tonnes in each of the previous two months.Supply held relatively steady even amid a dip in shipments from Spain to a two-year low and from Asia to a twenty-month low.A rise in imports from the Middle East, and especially from Qatar, balanced out the drop in supplies from those other markets.Maintenance work on several key Group III plants in the Middle East in the second quarter of the year raised the prospect of supplies from that region also staying volatile..Any subsequent slowdown in shipments from the Middle East at the start of the third quarter in turn coincided with signs of a recovery in supplies from Spain and Asia in July and August.Europe’s Group III base oils prices showed signs of mirroring the region’s relatively rangebound supplies.Group III base oils prices strengthened relative to Group I and Group II prices throughout the second quarter of the year.They then extended their rise so far in the current quarter.The higher price-differentials pointed to firmer supply-demand fundamentals during a period that involved a heavy round of Group III plant-maintenance work globally and a seasonal rise in regional demand.But the recent price-strength was relative.Group III prices climbed to their highest versus Group I and Group II prices since the fourth quarter of last year. But they remained well below levels during the previous two years..Europe’s May Group III base oils supply holds firm.US’ June base oils imports rise.Base Oil News stories and analysis also available on ICIS platform
