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Italy's lubricants demand rose for an eighth straight month in January but at its slowest pace since May
Automobile lubricants demand fell for the first time in eight months, while Spain and Portugal also showed slowing growth
Slower Mediterranean momentum raises concern about the strength of a broader European lubricants recovery
Italy’s lubricants demand rose in January for an eighth straight month but at its slowest pace since May, adding to signs that growth across the Mediterranean region is losing momentum even before any broader Europe-wide recovery has gained traction.
Italy’s lubricants consumption rose to 29,900 tonnes in January, up 0.7% year on year and 13% higher than December’s 26,500 tonnes, Ministry of Environment and Energy Security data showed.
The pace of expansion slowed for a third straight month, easing from growth of more than 7% in October.
Spain and Portugal mirrored that dynamic at the end of last year, with both markets losing momentum at the same time.
Given Italy’s role as a bellwether for wider European lubricants demand trends, its slowing demand growth suggests that any regionwide recovery remains fragile.
Key Highlights
· Italy’s automobile lubricants demand fell for the first time in eight months, squeezed by a simultaneous drop in passenger-car motor oil and heavy-duty engine oil consumption.
· Industrial oil consumption rose 2% year on year and for a fourth straight month, supported by stronger demand for process oils, hydraulic fluids and transformer oils.
· Spain’s December lubricants consumption rose 1.5% year on year to 30,600 tonnes, with growth slowing sharply from November’s 9% rate.
· Portugal’s December lubricants demand fell 5% year on year, reversing November’s 1% rise and extending a pattern of fading momentum across Mediterranean markets.
Market Repercussions
Lubricants demand in Mediterranean markets like Spain and Italy outperformed the rest of Europe over the past three years.
A slowdown in those markets would weaken prospects for a broader European recovery and point to a more moderate seasonal pick-up in consumption over the coming months.
Concern over demand prospects incentivized regional blenders to maintain leaner inventories of finished lubricants and base oils feedstock supplies.
