· Asia’s base oils demand likely to get support from upcoming seasonal rise in consumption throughout the region, and blenders’ need to replenish stocks accordingly.· Demand could get further support from persistently firm domestic consumption in India and signs of lower inventories in southeast Asia.· Firmer base oils prices and prospect of tighter supply add to incentive for buyers to lock in requirements..· Asia’s lube demand set to get seasonal boost over coming months..· Rise in lube demand would boost requirements for base oils feedstock supplies.· Rise in demand set to coincide with round of plant maintenance work throughout Asia in H1 2025.· Seasonal rise in demand and prospect of tighter supply could incentivize blenders to lock in additional requirements..· China’s base oils demand shows signs of staying weaker than usual for time of year.· Taiwan’s base oils exports to China stay low in Jan 2025..· Low volume likely partly reflects impact of Lunar New Year holidays, which fell in month of January this year.· Lunar-New-Year effect should mean strong pick-up in Taiwan’s exports to China in Feb 2025.· Taiwan’s exports to China stay low so far in Feb 2025.· China’s base oils imports typically rise strongly in first quarter of the year even with growing self-sufficiency of supply.· Planned plant maintenance in China starting in Q1 2025 likely to add to requirements for top-up volumes from overseas markets.· Taiwan’s muted base oils export volumes to China so far in Jan-Feb 2025 suggest that domestic buyers are covering additional requirements with supplies from other sources, or that demand is weak, curbing need for large volume of additional supplies..· Singapore’s base oils exports China and southeast Asia extend fall over last four weeks..· Slowdown in shipments to southeast Asia suggests regional buyers are securing supplies from other sources or that they head into peak-demand period with lower stocks.· Slowdown in shipments to China mirrors similar trend for supplies from Taiwan..· China’s domestic Group II light-grade prices continue to edge lower vs Shandong diesel and vs FOB Asia prices.· Domestic Group I brightstock premium to FOB Asia price drifts lower after spiking in H2 Jan 2025..· Weakening price differentials suggest seasonal pick-up in China’s demand remains more muted than usual, even for products for which it remains more reliant on supplies from overseas markets..· Thailand blender PSP Specialties’ share of country’s lube market and base oils imports surges in 2024..· Rising market share of Thailand’s largest independent lube blender could provide opportunities for overseas refiners seeking more outlets for their supplies..· India’s base oils demand could get support from sustained rise in country’s lube consumption that extends through Jan 2025..· Rising lube demand consumes growing volumes of base oils supplies, keeping blenders’ stocks low and complicating moves to replenish inventories.· Lower inventories could leave blenders with tighter-than-usual supplies ahead of seasonal surge in demand in month of March.· Rising lube consumption likely to sustain blenders’ firm requirements for overseas base oils supplies until new domestic production capacity comes online.· Planned plant maintenance work in India in Q1 2025 likely adds to blenders’ reliance on overseas supplies..· India’s base oils demand for overseas supplies showed signs of pausing in early-2025 as wave of arbitrage shipments from US reached the country..· Signs of pause in demand for overseas supplies could reflect expectations of additional flow of arbitrage shipments from US to India early this year.· Volume of any additional arbitrage shipments from US in coming months likely to be lower than at start of 2025.· Slowdown in arbitrage shipments would put pressure on buyers to target supplies from other sources instead..· Any such pick-up in requirements from other sources could put pressure on imported cargo prices to adjust accordingly to boost attraction of moving more shipments to India.· India’s imported Group II cargo price premium to FOB NE Asia prices duly recovers in Feb 2025 after narrowing in Jan 2025..· CFR India premium vs FOB NE Asia and US export prices remains much lower than year-earlier levels, complicating line-up and volume of any additional shipments to India.· Lining up additional supplies could also be more challenging at a time when plant-maintenance work in Asia cuts surplus supply..· Pakistan’s three largest base oils importers account for more than 75% of country’s total imports in 2024.· Large share magnifies importance of those importers’ procurement plans.· Change in those importers’ shipments triggers marked change in flows from different sources..· Change in trade flows suggest supplies from South Korea see largest impact from rise in shipments from US to Pakistan..India’s January base oils imports rise.Taiwan’s January base oils exports fall.Asia lube demand to revive in H1 2025.Asia base oils demand outlook: Week of 10 Feb
· Asia’s base oils demand likely to get support from upcoming seasonal rise in consumption throughout the region, and blenders’ need to replenish stocks accordingly.· Demand could get further support from persistently firm domestic consumption in India and signs of lower inventories in southeast Asia.· Firmer base oils prices and prospect of tighter supply add to incentive for buyers to lock in requirements..· Asia’s lube demand set to get seasonal boost over coming months..· Rise in lube demand would boost requirements for base oils feedstock supplies.· Rise in demand set to coincide with round of plant maintenance work throughout Asia in H1 2025.· Seasonal rise in demand and prospect of tighter supply could incentivize blenders to lock in additional requirements..· China’s base oils demand shows signs of staying weaker than usual for time of year.· Taiwan’s base oils exports to China stay low in Jan 2025..· Low volume likely partly reflects impact of Lunar New Year holidays, which fell in month of January this year.· Lunar-New-Year effect should mean strong pick-up in Taiwan’s exports to China in Feb 2025.· Taiwan’s exports to China stay low so far in Feb 2025.· China’s base oils imports typically rise strongly in first quarter of the year even with growing self-sufficiency of supply.· Planned plant maintenance in China starting in Q1 2025 likely to add to requirements for top-up volumes from overseas markets.· Taiwan’s muted base oils export volumes to China so far in Jan-Feb 2025 suggest that domestic buyers are covering additional requirements with supplies from other sources, or that demand is weak, curbing need for large volume of additional supplies..· Singapore’s base oils exports China and southeast Asia extend fall over last four weeks..· Slowdown in shipments to southeast Asia suggests regional buyers are securing supplies from other sources or that they head into peak-demand period with lower stocks.· Slowdown in shipments to China mirrors similar trend for supplies from Taiwan..· China’s domestic Group II light-grade prices continue to edge lower vs Shandong diesel and vs FOB Asia prices.· Domestic Group I brightstock premium to FOB Asia price drifts lower after spiking in H2 Jan 2025..· Weakening price differentials suggest seasonal pick-up in China’s demand remains more muted than usual, even for products for which it remains more reliant on supplies from overseas markets..· Thailand blender PSP Specialties’ share of country’s lube market and base oils imports surges in 2024..· Rising market share of Thailand’s largest independent lube blender could provide opportunities for overseas refiners seeking more outlets for their supplies..· India’s base oils demand could get support from sustained rise in country’s lube consumption that extends through Jan 2025..· Rising lube demand consumes growing volumes of base oils supplies, keeping blenders’ stocks low and complicating moves to replenish inventories.· Lower inventories could leave blenders with tighter-than-usual supplies ahead of seasonal surge in demand in month of March.· Rising lube consumption likely to sustain blenders’ firm requirements for overseas base oils supplies until new domestic production capacity comes online.· Planned plant maintenance work in India in Q1 2025 likely adds to blenders’ reliance on overseas supplies..· India’s base oils demand for overseas supplies showed signs of pausing in early-2025 as wave of arbitrage shipments from US reached the country..· Signs of pause in demand for overseas supplies could reflect expectations of additional flow of arbitrage shipments from US to India early this year.· Volume of any additional arbitrage shipments from US in coming months likely to be lower than at start of 2025.· Slowdown in arbitrage shipments would put pressure on buyers to target supplies from other sources instead..· Any such pick-up in requirements from other sources could put pressure on imported cargo prices to adjust accordingly to boost attraction of moving more shipments to India.· India’s imported Group II cargo price premium to FOB NE Asia prices duly recovers in Feb 2025 after narrowing in Jan 2025..· CFR India premium vs FOB NE Asia and US export prices remains much lower than year-earlier levels, complicating line-up and volume of any additional shipments to India.· Lining up additional supplies could also be more challenging at a time when plant-maintenance work in Asia cuts surplus supply..· Pakistan’s three largest base oils importers account for more than 75% of country’s total imports in 2024.· Large share magnifies importance of those importers’ procurement plans.· Change in those importers’ shipments triggers marked change in flows from different sources..· Change in trade flows suggest supplies from South Korea see largest impact from rise in shipments from US to Pakistan..India’s January base oils imports rise.Taiwan’s January base oils exports fall.Asia lube demand to revive in H1 2025.Asia base oils demand outlook: Week of 10 Feb
