Italy’s base oils output fell in October for a fourth month to the lowest level in more than a year.Lower output contrasted with steady demand in October, prompting a slump in Italy’s base oils stocks to the lowest in more than two years.The drop in output slashed supply at a time of year when the country often faces pressure to clear rising surplus volumes through the export market.The slump in output and stocks instead left Italy facing unusually tight base oils supply during the final months of the year.Italy’s base oils output of 32,000 tonnes in October fell from close to 47,000 tonnes in September to the lowest since mid-2023, government data showed.Output mostly held in a 55,000-65,000 tonne/month range throughout most of this year, before dipping below that level in September and slumping in October.The steeper drop in output in September and October pointed to factors such as maintenance work at Italy’s sole Group I base oils unit.The country’s other Group I base oils unit was closed in first-half 2024.The impact of the closure was more muted because the plant had been offline for extended periods during most of the previous two years.But the closure of the plant magnified the impact of any change in production at Italy’s only other Group I unit.Lower output contrasted with steady demand that held at 47,300 tonnes in October. Consumption held close to that level in each of the previous two months.With demand outpacing output, Italy’s base oils stocks fell to less than 55,000 tonnes in October.The volume fell from close to 70,000 tonnes in September to the lowest since first-half 2022.Tighter supply left Italy focusing on covering domestic and regional requirements at a time of year when it typically faced the challenge of finding overseas outlets for surplus shipments.The surplus shipments typically added to downward pressure on Europe’s Group I base oils prices at year-end and at the start of the new year, especially for brightstock.The premium of Europe’s domestic Group I brightstock prices over SN 500 instead rose in the fourth quarter of this year to its widest level in almost two years.Domestic brightstock prices also rose strongly relative to export prices and held unusually firm versus vacuum gasoil prices during the fourth quarter.Easing pressure to clear surplus volumes at year-end contrasted with growing pressure on domestic and regional buyers to line up alternative sources of base oils supply.That pressure was likely to increase in the coming weeks as buyers look to replenish depleted stocks at the start of the new year..Italy’s October lube demand falls.UK’s Sept base oils output rises.Europe’s September base oils exports fall
