· Global crude oil prices hold at lower levels amid concerns any additional rise in supply would add to expected surplus.· Concern about weak fundamentals counters impact of growing geopolitical tensions in Middle East. · Diesel premium to crude holds close to lowest in more than two years, compounding slowdown in refiners’ demand for crude oil supplies.· Global base oils demand could stay more muted in view of still-high base oils values relative to feedstock and diesel prices in most markets for most products.· Prospect of seasonal slowdown in demand in Q4 2024 and expectations of pick-up in surplus supply add to attraction of keeping inventories low.· Fall in outright prices for some base oils grades likely to add to buyers’ preference to hold back for now until they are more comfortable that prices, supply and demand are better aligned.· Asia’s base oils demand likely to be mixed, with expectations of downward price pressure deterring buyers, while underlying lube demand holds firm.· India’s base oils demand could stay firmer, with blenders facing low stocks and seasonal pick-up in lube consumption.· China’s base oils demand could be firmer than expected, with domestic prices increasingly firm versus FOB Asia prices even with strong rise in domestic supply in Q3 2024.· Europe’s base oils demand could turn more muted as falling prices and still-shrinking lube consumption add to incentive for buyers to minimize stocks.· Region’s Group II base oils demand could be mixed, with improving supply supporting steadier consumption.· Surge in Group II price premium to Group I boosts attraction for blenders to hold back, seek more Group I base oils instead.· US base oils demand could see earlier-than-usual seasonal slowdown as buyers tap left-over stocks to cover any seasonal pick-up in requirements at end-Q3/early-Q4. · Falling base oils prices and expectations of rise in surplus supply add to incentive to hold back.· Signs of pick-up in US shipments to overseas markets points to moves to respond to more muted domestic demand.· Latin America’s demand could be more mixed as expectations of sufficient supply curb urgency to buy.· Demand for US supplies could improve as arbitrage from other markets turns less attractive..Global base oils margins outlook: Week of 30 Sept.Global base oils arb outlook: Week of 30 Sept.Asia base oils demand outlook: Week of 30 Sept
· Global crude oil prices hold at lower levels amid concerns any additional rise in supply would add to expected surplus.· Concern about weak fundamentals counters impact of growing geopolitical tensions in Middle East. · Diesel premium to crude holds close to lowest in more than two years, compounding slowdown in refiners’ demand for crude oil supplies.· Global base oils demand could stay more muted in view of still-high base oils values relative to feedstock and diesel prices in most markets for most products.· Prospect of seasonal slowdown in demand in Q4 2024 and expectations of pick-up in surplus supply add to attraction of keeping inventories low.· Fall in outright prices for some base oils grades likely to add to buyers’ preference to hold back for now until they are more comfortable that prices, supply and demand are better aligned.· Asia’s base oils demand likely to be mixed, with expectations of downward price pressure deterring buyers, while underlying lube demand holds firm.· India’s base oils demand could stay firmer, with blenders facing low stocks and seasonal pick-up in lube consumption.· China’s base oils demand could be firmer than expected, with domestic prices increasingly firm versus FOB Asia prices even with strong rise in domestic supply in Q3 2024.· Europe’s base oils demand could turn more muted as falling prices and still-shrinking lube consumption add to incentive for buyers to minimize stocks.· Region’s Group II base oils demand could be mixed, with improving supply supporting steadier consumption.· Surge in Group II price premium to Group I boosts attraction for blenders to hold back, seek more Group I base oils instead.· US base oils demand could see earlier-than-usual seasonal slowdown as buyers tap left-over stocks to cover any seasonal pick-up in requirements at end-Q3/early-Q4. · Falling base oils prices and expectations of rise in surplus supply add to incentive to hold back.· Signs of pick-up in US shipments to overseas markets points to moves to respond to more muted domestic demand.· Latin America’s demand could be more mixed as expectations of sufficient supply curb urgency to buy.· Demand for US supplies could improve as arbitrage from other markets turns less attractive..Global base oils margins outlook: Week of 30 Sept.Global base oils arb outlook: Week of 30 Sept.Asia base oils demand outlook: Week of 30 Sept
