· Americas/EMEA base oils demand likely to get support from firmer end-user consumption over coming weeks as prices trend higher.· US gasoline demand rises in mid-September for twenty-fifth time in twenty-six weeks..· US lube end-users could bring forward procurement plans after US blenders announce finished lube price-increases during October.· Such moves would trigger firmer demand over coming weeks, likely followed by sharper slowdown from end-October.· Pick-up in end-user demand would help to reduce blenders’ inventories before seasonal slowdown during final weeks of year.· Blenders’ depleted inventories would raise prospect of more typical feedstock procurement activity over coming weeks.· Latin America’s lube demand faces seasonal slowdown in Q4 from Q3 2023..· But demand in Q3 and Q4 2023 likely to remain firmer than earlier expectations and above year-earlier levels..· Latin America’s rising lube demand in July contrasts with shrinking consumption in other major markets like Asia and Europe..· Trend boosts region’s base oils requirements and attraction of overseas suppliers to cover those requirements.· Latin America’s firmer demand this year mostly reflects sustained strength of Brazil's lube market..· That strength shows signs of extending through Q3 2023 as Brazil’s August lube demand rises to five-month high.· Rise in Brazil’s lube demand extends to industry-related oils as well as PCMO..· Brazil’s rising lube demand raises prospect of supporting sustained demand for overseas base oils supplies, even after completion of base oils plant maintenance work in Q3-Q4 2023..· Mexico’s demand for US light-grade base oils as a fuel-extender likely to stay firm as rising US diesel prices cushion impact of higher base oil export prices.· Firmer demand would follow slowdown in US shipments to Mexico in June and July, when base oils prices were less attractive versus diesel prices..· Firmer demand would curb US refiners’ need to target other markets like India to clear surplus light grades..· Europe’s base oils demand likely to get support from balanced-to-tight supply, blenders’ lower stocks, and prospect of firmer prices.· Concern about lube demand outlook likely to deter blenders from building larger stocks.· Trend raises prospect of steadier demand for smaller volumes.· Demand likely to be firmer than same time last year, when blenders focused on clearing high stocks.· Regional demand likely to stay more mixed - sustained fall in Germany’s lube demand contrasts with firmer consumption in Mediterranean market..· Trend raises prospect of change in base oils requirements and logistics to meet growing demand in markets like Italy and Spain relative to Germany..· Trend shows signs of extending at least through Q3 2023 as Italy’s August lube demand extends rise for third month..· Ongoing rebound in industrial oils consumption adds to sustainability of recovery, boosts demand for more base oils grades suitable for production of industrial oils..· Mideast Gulf absorbs growing base oils volumes from South Korea in 2023..· Surge in shipments reflects rising demand and open arbitrage.· Trend likely to continue amid slowdown in US arbitrage shipments..Global base oils - week of Sep 25: Price outlook - margins
· Americas/EMEA base oils demand likely to get support from firmer end-user consumption over coming weeks as prices trend higher.· US gasoline demand rises in mid-September for twenty-fifth time in twenty-six weeks..· US lube end-users could bring forward procurement plans after US blenders announce finished lube price-increases during October.· Such moves would trigger firmer demand over coming weeks, likely followed by sharper slowdown from end-October.· Pick-up in end-user demand would help to reduce blenders’ inventories before seasonal slowdown during final weeks of year.· Blenders’ depleted inventories would raise prospect of more typical feedstock procurement activity over coming weeks.· Latin America’s lube demand faces seasonal slowdown in Q4 from Q3 2023..· But demand in Q3 and Q4 2023 likely to remain firmer than earlier expectations and above year-earlier levels..· Latin America’s rising lube demand in July contrasts with shrinking consumption in other major markets like Asia and Europe..· Trend boosts region’s base oils requirements and attraction of overseas suppliers to cover those requirements.· Latin America’s firmer demand this year mostly reflects sustained strength of Brazil's lube market..· That strength shows signs of extending through Q3 2023 as Brazil’s August lube demand rises to five-month high.· Rise in Brazil’s lube demand extends to industry-related oils as well as PCMO..· Brazil’s rising lube demand raises prospect of supporting sustained demand for overseas base oils supplies, even after completion of base oils plant maintenance work in Q3-Q4 2023..· Mexico’s demand for US light-grade base oils as a fuel-extender likely to stay firm as rising US diesel prices cushion impact of higher base oil export prices.· Firmer demand would follow slowdown in US shipments to Mexico in June and July, when base oils prices were less attractive versus diesel prices..· Firmer demand would curb US refiners’ need to target other markets like India to clear surplus light grades..· Europe’s base oils demand likely to get support from balanced-to-tight supply, blenders’ lower stocks, and prospect of firmer prices.· Concern about lube demand outlook likely to deter blenders from building larger stocks.· Trend raises prospect of steadier demand for smaller volumes.· Demand likely to be firmer than same time last year, when blenders focused on clearing high stocks.· Regional demand likely to stay more mixed - sustained fall in Germany’s lube demand contrasts with firmer consumption in Mediterranean market..· Trend raises prospect of change in base oils requirements and logistics to meet growing demand in markets like Italy and Spain relative to Germany..· Trend shows signs of extending at least through Q3 2023 as Italy’s August lube demand extends rise for third month..· Ongoing rebound in industrial oils consumption adds to sustainability of recovery, boosts demand for more base oils grades suitable for production of industrial oils..· Mideast Gulf absorbs growing base oils volumes from South Korea in 2023..· Surge in shipments reflects rising demand and open arbitrage.· Trend likely to continue amid slowdown in US arbitrage shipments..Global base oils - week of Sep 25: Price outlook - margins
