Spain’s May base oils supply steady

Spain's base oils supply held relatively firm in May, cushioning the impact of tighter availability in other European countries.

Total supplies of 72,900t in May edged up from 72,540t the previous month.

The volumes boosted total supplies to 346,470t in the first five months of the year.

The volume was up 25pc from 277,760t during the same period in 2021 and the highest for that five-month period in at least three years.

The volumes were derived from government production and port data.

The rise in supply partly reflected the relative lack of plant maintenance work in Spain during the first few months of the year.

Some scheduled maintenance work was postponed several times before finally taking place late in the second quarter of the year.

The steady production contrasted with a heavy round of plant maintenance work in first-half 2021. The work affected Group I and Group III base oils production.

The rise in supply this year also coincided with higher refinery run rates. High diesel prices and tight supply of the motor fuel incentivized refiners to raise production.

Spain’s refined products output rose in May to its highest since third-quarter 2019. Diesel output as a share of total production rose to a 13-month high.

By contrast, Group I base oils production as a share of total production only rose to the highest since March.

But the higher refinery run rates converted the steady share of output into a rise in total base oils production.

The trend suggested that an increase in base oils production was a side-effect of rising diesel output through higher refinery run rates.