· Asia’s base oils demand likely to get support from steady-to-firm lube consumption in southeast Asia/India, signs of steadier demand in China.· China’s domestic Group II base oils prices hold firm versus diesel values, even in face of rising domestic supply and lower feedstock prices.· China’s domestic bright stock prices hold firm vs fob Asia prices, even if down from recent highs at end-Oct 2023..· Restart of several base oils units in China in Nov 2023 could increase surplus supplies in the country, putting downward pressure on prices.· Move to restart base oil units could reflect/cover for impact of slowdown in shipments from Taiwan to China in Q4 2023.· Move could reflect expectations/signs of pick-up in demand.· Prospect of rise in supplies coincides with slowdown in Singapore’s base oils imports from China in 1H Nov 2023, contrasting with surge in supplies in Oct 2023.· Slowdown in shipments could reflect temporarily tighter supplies, or signs of pick-up in domestic demand..· South Korea’s higher exports to China in Oct 2023 add to signs of firmer demand..· Move could reflect pick-up in end-user consumption or to cover for drop in supplies from Taiwan.· Moves to replenish stocks would be unusual at a time when base oils prices face downward pressure from lower feedstock costs..· Asia’s September lube demand rises for fifth month on sustained rise in consumption throughout the region..· Stronger-than-expected demand absorbs more of the region’s base oils supplies.· Strong demand cuts size of region’s base oils surplus, curbs need for adjustment in regional prices to make feasible the arbitrage to more distant markets.· Smaller surplus contrasts with wave of arbitrage shipments from Asia to other markets in 2H 2022..· Singapore’s base oils exports to southeast Asia hold relatively firm in month to mid-Nov 2023, especially versus flows to China and India..· Steady flows point to firm regional demand.· Steady flows could also point to Singapore’s rising share of southeast Asia’s base oils requirements.· Trend helps to counter weaker demand from China and possibility of drop in demand from India when domestic supply rises in that market.· Singapore’s base oils exports to India stay lower than usual in month to mid-Nov 2023.· Slowdown in exports could reflect signs of large rise in shipments from South Korea to India in recent weeks..· India’s Group II base oils imports stay unusually high in Oct 2023..· Persistently-high volumes point to firm domestic demand.· Most of the supplies originate from Asia in face of waning arbitrage flows from US.· Trend could complicate any subsequent arbitrage shipments from US unless prices are competitive..· India’s demand for overseas supplies of light-grade N70 base oils holds steady..· India’s imports of N70 recover in Oct 2023 to more typical levels after slump in supplies in Sept 2023.· Origin of the supplies changes, with surge in flows from Saudi Arabia and extended drop in shipments from South Korea.· India’s imports of light-grade N60 base oils extend fall in Oct 2023 and throughout the year.· Slide in India’s imports of very-light grade base oils since early 2022 reflects more the fall in shipments of N60 supplies.· Demand for N60 likely to stay muted even as premium of India’s domestic retail diesel price rises in Nov 2023 versus imported very-light grade prices.· Diesel premium to imported very-light grade prices stays lower than in Jan-Aug 2023..Global base oils - week of Nov 20: Demand outlook
· Asia’s base oils demand likely to get support from steady-to-firm lube consumption in southeast Asia/India, signs of steadier demand in China.· China’s domestic Group II base oils prices hold firm versus diesel values, even in face of rising domestic supply and lower feedstock prices.· China’s domestic bright stock prices hold firm vs fob Asia prices, even if down from recent highs at end-Oct 2023..· Restart of several base oils units in China in Nov 2023 could increase surplus supplies in the country, putting downward pressure on prices.· Move to restart base oil units could reflect/cover for impact of slowdown in shipments from Taiwan to China in Q4 2023.· Move could reflect expectations/signs of pick-up in demand.· Prospect of rise in supplies coincides with slowdown in Singapore’s base oils imports from China in 1H Nov 2023, contrasting with surge in supplies in Oct 2023.· Slowdown in shipments could reflect temporarily tighter supplies, or signs of pick-up in domestic demand..· South Korea’s higher exports to China in Oct 2023 add to signs of firmer demand..· Move could reflect pick-up in end-user consumption or to cover for drop in supplies from Taiwan.· Moves to replenish stocks would be unusual at a time when base oils prices face downward pressure from lower feedstock costs..· Asia’s September lube demand rises for fifth month on sustained rise in consumption throughout the region..· Stronger-than-expected demand absorbs more of the region’s base oils supplies.· Strong demand cuts size of region’s base oils surplus, curbs need for adjustment in regional prices to make feasible the arbitrage to more distant markets.· Smaller surplus contrasts with wave of arbitrage shipments from Asia to other markets in 2H 2022..· Singapore’s base oils exports to southeast Asia hold relatively firm in month to mid-Nov 2023, especially versus flows to China and India..· Steady flows point to firm regional demand.· Steady flows could also point to Singapore’s rising share of southeast Asia’s base oils requirements.· Trend helps to counter weaker demand from China and possibility of drop in demand from India when domestic supply rises in that market.· Singapore’s base oils exports to India stay lower than usual in month to mid-Nov 2023.· Slowdown in exports could reflect signs of large rise in shipments from South Korea to India in recent weeks..· India’s Group II base oils imports stay unusually high in Oct 2023..· Persistently-high volumes point to firm domestic demand.· Most of the supplies originate from Asia in face of waning arbitrage flows from US.· Trend could complicate any subsequent arbitrage shipments from US unless prices are competitive..· India’s demand for overseas supplies of light-grade N70 base oils holds steady..· India’s imports of N70 recover in Oct 2023 to more typical levels after slump in supplies in Sept 2023.· Origin of the supplies changes, with surge in flows from Saudi Arabia and extended drop in shipments from South Korea.· India’s imports of light-grade N60 base oils extend fall in Oct 2023 and throughout the year.· Slide in India’s imports of very-light grade base oils since early 2022 reflects more the fall in shipments of N60 supplies.· Demand for N60 likely to stay muted even as premium of India’s domestic retail diesel price rises in Nov 2023 versus imported very-light grade prices.· Diesel premium to imported very-light grade prices stays lower than in Jan-Aug 2023..Global base oils - week of Nov 20: Demand outlook