Global base oils – the week ahead

· Diesel values remain unusually high versus crude

· Base oil values improve versus diesel, but remain unusually low

· Weak values versus diesel incentivize refiners to produce more middle distillates

· Narrower-than-usual heavy-grade premium to light grades increase incentive to produce more middle distillates

· Speed of base oils price-response lags change in crude/diesel values, adding to pressure on premiums

· Rising prices incentivize producers to hold onto supplies, prioritise domestic market

· Overseas buyers more reliant on imports face prospect of tighter availability

· Availability of surplus N70 likely to tighten for countries like India

· Availability of surplus heavy grades likely to tighten to markets like West Africa