Netherlands’ Feb base oils output rises

The Netherlands’ base oils and lube output rose in February from the previous month, at a time when US exports to Europe have fallen sharply.

Base oils and lube output of 84,000t in February rose by 18pc from 71,000t the previous month, government data showed.

The January volume had been the lowest in 14 months. Even the February volume was down from typical levels of more than 100,000 t/month in 2021.

The country’s base oils output had been unusually high throughout 2021, when European base oils demand outpaced supply in the first half of the year especially.

The tight availability during that period partly reflected lower refinery run rates because of weak diesel margins.

Regional demand is again outpacing supply at the beginning of this year, but for different reasons.

Unusually strong diesel margins are incentivizing refiners to produce more of the motor fuel instead of base oils.

Regional plant shutdowns and a slump in supplies from Russia have also tightened availability of Group I base oils. The trend incentivizes buyers to seek alternative supplies such as Group II or Group III base oils.

The pick-up in the Netherlands’ output in February coincided with an unusual surge in the country’s total consumption, mostly under the category of ‘refineries’.

Total consumption of 114,000t in February rose from 68,000t the previous month and from more typical levels of less than 20,000 t/month in 2021.

By contrast, the Netherlands’ final consumption in February was steady at 14,000t.

The surge in total consumption coincided with a slump in US base oil exports to Europe in February.