The delivery of premium-grade base oils from the Middle East to key global outlets surged to a thirty-month high in March.The rise in shipments boosted stocks in those key outlets ahead of a heavy round of plant maintenance work in the Middle East in the second quarter of the year.The maintenance work, and subsequent impact on base oils supplies, showed signs of having the largest impact on Europe, where Group III prices outperformed prices in other regions during the second quarter.Europe’s prices outperformed other markets like the US, even with that outlet accounting for the largest share of premium-grade supplies from the Middle East.The US, Europe and Asia took delivery of around 290,000 tonnes of base oils from Qatar, UAE and Bahrain combined in March, government data showed.The volume was the highest since September 2022 and rebounded from less than 150,000 tonnes in February.The surge in imports coincided with a seasonal rise in lube consumption in Asia at the end of the first quarter.It helped to replenish stocks ahead of a seasonal pick-up in demand in Europe and the US in the second quarter of the year.The round of stock-replenishment preceded maintenance work on two key Group III base oils units in the Middle East during the second quarter.The shipments lifted total US imports from the Middle East in the three months to March to the highest level since November..For Asia, the three-month total was the highest since October.For Europe, the three-month total held in a narrow range.The smaller rise shipments to Europe and smaller build-up of inventories left that region more exposed to any slowdown in supplies from the Middle East during the second quarter of the year.Europe’s Group III (low) 4cSt base oil price rose in May to the highest level in almost six months, reflecting the impact of tighter supply.Europe's higher price flipped from a discount to US Group III prices in early April to the widest premium to US prices since the beginning of the year.Europe's prices outperformed US Group III prices even with shipments from Bahrain and the UAE accounting for less than 18% of Europe’s Group III base oils supplies.For the US, the shipments account for close to 22% of its Group III imports.The US’ greater reliance on supplies from the UAE and Bahrain suggests that a slowdown in shipments from those sources could have a growing impact on the US market as its inventories start to dwindle..Europe’s March Group III base oils supply rises.US’ March base oils imports rise
