The delivery of premium-grade base oils from the Middle East to key global outlets rose to a three-month high in March amid a recovery in shipments from Qatar to Europe.The pick-up in flows to Europe showed signs of extending into the second quarter of the year.The key outlets of US, Europe and Asia took delivery of more than 250,000 tonnes of premium-grade base oils in March from the UAE, Bahrain and Qatar combined, government data showed.The volume rose from less than 190,000 tonnes in each of the previous two months.The pick-up in flows from Qatar to Europe contrasted with an ongoing slowdown in shipments from the UAE to Europe that began in the fourth quarter of last year.The slowdown compounded a fall in Europe’s premium-grade base oils imports from the Middle East in the first quarter of the year from year-earlier levels.US imports from the Middle East also fell in the first quarter, but less steeply.Asia was the outlier, with the region’s imports rising during the first three months of the year.Europe’s Group III base oils prices were at a steep discount to US Group III prices during the first quarter of the year.Their premium to FOB Asia Group III prices also stayed lower than usual during that period.The price weakness incentivized overseas refiners to move more Group III supplies to the US and Asia.A slump in US Group III prices from the start of the second quarter of the year changed those dynamics.US prices flipped to a steep discount to Europe Group III prices in April and to a smaller discount to FOB Asia Group III prices.The premium of Europe’s Group III price over FOB Asia prices also held firmer after bottoming out in February.The price dynamics incentivized refiners in the Middle East to cut shipments to the US and move more cargoes to Asia and especially to Europe.There were already signs of a pick-up in shipments that were set to reach Europe during the second quarter of the year. The volumes would add to a strong rebound in the region’s Group III base oils supply at the end of the first quarter of the year.There were by contrast signs of a slowdown in Asia’s imports in April from the Middle East in key outlets like China, Singapore, and India..Global base oil exports to Middle East stay high in March.Europe’s March Group III supply rises.US’ March base oils imports fall
