The UK’s base oils output rose in September to the highest in almost six years, more than outweighing a drop in Group I production in Italy and Spain.The surge in output, combined with a rise in Europe’s base oils imports from markets producing Group I base oils, lifted the region’s Group I supply to a seventeen-month high.Supply rose ahead of a seasonal slowdown in demand in the fourth quarter of the year.The diverging supply-demand fundamentals raised the prospect of adding to pressure on the region’s Group I prices during the final months of the year.The UK’s base oils output of 46,000 tonnes in September more than doubled from the same month a year earlier to the highest since October 2018, government data showed.The surge in output added to a sustained rise in base oils production to 128,000 tonnes in the four months to September.The volume was up more than 50% from less than 85,000 tonnes during the same period last year.The pick-up in output, combined with a sustained rise in Europe’s base oils imports, boosted the region’s base oils supply from Group I sources to around 210,000 tonnes in September.The volume was the highest since April 2023.Europe's supply of close to 570,000 tonnes in the third quarter was the highest for that three-month period since 2021.The rise in Europe’s base oils supply also contrasted with a fall in the region’s Group I exports to non-EU markets in September for the seventh time in eight months from year-earlier levels.The diverging trends added to the rise in surplus supply.The higher-than-usual volume for the time of year was likely more than sufficient to cover a seasonal pick-up in regional demand at the end of the third quarter.The rise in supply then preceded a seasonal slowdown in regional consumption during the final months of the year..Europe’s September base oils exports fall.Europe’s Sept Group III supply falls.Netherlands’ Sept base oils output rises
