Italy’s lube demand fell in January for a sixth month, curbing blenders’ urgency to replenish low inventories and instead highlighting the attraction of maintaining low stocks.The country's lube consumption of 29,700 tonnes in January fell by 7% from year-earlier levels, government data showed..Demand fell as a slump in consumption of process oils and transformer oils triggered a 12% drop in industrial oils demand.Consumption of automobile lubricants fell at a slower 2% pace.Lube demand still rose from 26,000 tonnes in December amid a typical recovery in consumption at the start of the year.But the year-on-year contraction muffled the size of the recovery.The fall in Italy’s lube consumption in January pointed to ongoing demand weakness throughout the rest of Europe.The region’s lube demand typically tracks the lube growth trends in Italy, whose consumption data is released several weeks before most other European countries.Shrinking lube demand magnified the impact of a seasonal slowdown in consumption during the winter months.Europe’s domestic base oils prices reflected the regional demand weakness.Domestic Group I and Group II base oils price premiums to vacuum gasoil (VGO) fell in mid-January close to the lowest levels that they reached in early 2024.They began to recover from those levels since then.The recovery began earlier than in 2024, when Group I and Group II price premiums to VGO bottomed out in the months of March and April.Europe’s export base oils prices also weakened relative to VGO early this year but stayed much higher than year-earlier levels.Domestic base oils price premiums recovered earlier and export price premiums held firmer compared with the same time last year even with the ongoing fall in lube demand.The relative price strength compared with last year pointed to more muted downward pressure from base oils supply early this year.The dynamic added to signs of a smaller supply surplus in Europe early this year, especially for Group I base oils..Europe Dec Grp III base oils supply falls.Asia’s December lube demand rises .Latam’s December lube demand rises.Brazil’s Jan lube demand extends rise
