· Asia’s base oils demand likely to be mixed as low feedstock costs, expectations of rise in supply incentivize buyers to hold back.· Firm underlying lube consumption and prospect of seasonal rise in demand in Q1 2024 likely to prompt buyers to maintain sufficient inventories.· China’s domestic Group II prices extend gradual recovery vs fob Asia values to three-month high even with signs of pick-up in supplies from Taiwan.· Arbitrage to China stays hard to work, pointing to still-cautious demand, especially for overseas supplies.· Domestic China Group I bright stock premium to fob Asia prices holds firm after sustained recovery since June 2023, making that arbitrage more feasible.· India’s buyers could hold back, even amid firm domestic lube consumption, amid expectations of lower prices..· Asia’s lube demand edges down in Oct 2023 as slower consumption in India counters rising demand in northeast and southeast Asia..· Strength of demand in southeast Asia highlights attraction for regional refiners to tap that market.· Slowdown in India’s lube demand highlights that market’s growing impact on regional consumption.· Trend highlights attraction of tapping that market, as well as importance of developing other markets to spread exposure beyond key outlets..· Taiwan’s base oils exports to China almost halt in Nov 2023, following sharp slowdown in Oct 2023..· Pause in shipments contrasts with recovery in Taiwan’s exports to India in Nov 2023.· China is usually the destination for most of Taiwan’s exports during any plant maintenance work, when availability is tighter.· The shipment of more supplies to India instead points to unusually weak demand in China for overseas supplies.· Reviving domestic Chinese Group II prices versus fob Asia prices since early Nov 2023 point to gradual improvement in Chinese demand in recent weeks, even if to replenish depleted stocks. .· South Korea’s base oils exports to Japan rise to eighteen-month high in Nov 2023.· Rise in shipments follows Japan’s closure of a Group I plant in Oct 2023, raising prospect of pick-up in country's demand for regional supplies to cover the shortfall..· Singapore’s weekly base oils exports rebound to southeast Asia and India, fall to China..· Fall in shipments to China could reflect temporary pause following recent rise in weekly exports to the country.· A more prolonged slowdown in shipments could reflect slower-than-expected domestic consumption in China. · Surge in shipments to southeast Asia extends trend of growing focus on tapping rising demand in the region.· Rise in shipments to India could add to wave of supplies moving to the country from other sources..· Philippines’ October base oils/lube imports fall for eighth month, contrasting with firmer consumption in most other key markets in southeast Asia.· South Korea’s share of Philippines’ imports continues to rise sharply, while Singapore’s share falls..· South Korea’s refiners will need to replicate that trend in other markets in southeast Asia or face more reliance on other markets like China and India..· India’s November lube demand rises for sixth time in seven months amid strong economic growth..· Rise in lube demand lags surge in India’s base oils imports in Nov 2023.· Disconnect between supply and demand raises prospect of growing build-up of surplus supplies.· Any such trend would add to blenders’ ability and preference to delay procurement of additional supplies.· Expectations of healthy availability and lower prices already incentivize buyers to hold back. .Global base oils - week of Dec 18: Demand outlook.Global base oils - week of Dec 18 Price outlook - margins.Global base oils - week of Dec 18: Price outlook - arbitrage
· Asia’s base oils demand likely to be mixed as low feedstock costs, expectations of rise in supply incentivize buyers to hold back.· Firm underlying lube consumption and prospect of seasonal rise in demand in Q1 2024 likely to prompt buyers to maintain sufficient inventories.· China’s domestic Group II prices extend gradual recovery vs fob Asia values to three-month high even with signs of pick-up in supplies from Taiwan.· Arbitrage to China stays hard to work, pointing to still-cautious demand, especially for overseas supplies.· Domestic China Group I bright stock premium to fob Asia prices holds firm after sustained recovery since June 2023, making that arbitrage more feasible.· India’s buyers could hold back, even amid firm domestic lube consumption, amid expectations of lower prices..· Asia’s lube demand edges down in Oct 2023 as slower consumption in India counters rising demand in northeast and southeast Asia..· Strength of demand in southeast Asia highlights attraction for regional refiners to tap that market.· Slowdown in India’s lube demand highlights that market’s growing impact on regional consumption.· Trend highlights attraction of tapping that market, as well as importance of developing other markets to spread exposure beyond key outlets..· Taiwan’s base oils exports to China almost halt in Nov 2023, following sharp slowdown in Oct 2023..· Pause in shipments contrasts with recovery in Taiwan’s exports to India in Nov 2023.· China is usually the destination for most of Taiwan’s exports during any plant maintenance work, when availability is tighter.· The shipment of more supplies to India instead points to unusually weak demand in China for overseas supplies.· Reviving domestic Chinese Group II prices versus fob Asia prices since early Nov 2023 point to gradual improvement in Chinese demand in recent weeks, even if to replenish depleted stocks. .· South Korea’s base oils exports to Japan rise to eighteen-month high in Nov 2023.· Rise in shipments follows Japan’s closure of a Group I plant in Oct 2023, raising prospect of pick-up in country's demand for regional supplies to cover the shortfall..· Singapore’s weekly base oils exports rebound to southeast Asia and India, fall to China..· Fall in shipments to China could reflect temporary pause following recent rise in weekly exports to the country.· A more prolonged slowdown in shipments could reflect slower-than-expected domestic consumption in China. · Surge in shipments to southeast Asia extends trend of growing focus on tapping rising demand in the region.· Rise in shipments to India could add to wave of supplies moving to the country from other sources..· Philippines’ October base oils/lube imports fall for eighth month, contrasting with firmer consumption in most other key markets in southeast Asia.· South Korea’s share of Philippines’ imports continues to rise sharply, while Singapore’s share falls..· South Korea’s refiners will need to replicate that trend in other markets in southeast Asia or face more reliance on other markets like China and India..· India’s November lube demand rises for sixth time in seven months amid strong economic growth..· Rise in lube demand lags surge in India’s base oils imports in Nov 2023.· Disconnect between supply and demand raises prospect of growing build-up of surplus supplies.· Any such trend would add to blenders’ ability and preference to delay procurement of additional supplies.· Expectations of healthy availability and lower prices already incentivize buyers to hold back. .Global base oils - week of Dec 18: Demand outlook.Global base oils - week of Dec 18 Price outlook - margins.Global base oils - week of Dec 18: Price outlook - arbitrage