· US Group II base oils export prices mostly stay in narrow range vs vacuum gasoil so far this year.· US’ steady price premium contrasts with strong rise in Asia Group II base oils export price premium to Singapore gasoil prices so far this year..· US Group I brightstock price rises vs vacuum gasoil so far this year.· Rising price premium contrasts with surge in Europe Group I brightstock export price premium to VGO so far this year..· Base oils price premiums in US, Europe and Asia stay firmer so far this year than in early 2024 amid signs of smaller supply-build at end-2024 and early this year.· US base oils stocks rise in Dec 2024 at much slower pace than usual at year-end as high export volumes in H2 2024 limit pace of supply-build. · Trend extends into early 2025, with US export volumes holding firm..· Europe’s Group I base oils supply dips in Q4 2024 amid lower output and rise in exports..· Asia’s base oils supply surplus falls at start of 2025 amid lower regional output and dip in exports from markets like South Korea..· Supply surplus falls at a time of year when it usually rises..· Signs of more manageable supply surplus supports base oils price premiums in US, Europe and Asia early this year that outperform year-earlier levels.· Base oils prices in Europe and Asia also outperform US prices early this year, pointing to other factors providing additional support, such as demand.· Asia’s lube demand rebounds at end-2024 and continues to rise early this year..· In Europe, firm prices, more balanced supply, blenders’ low inventories and prospect of seasonal rise in lube consumption support pick-up in region’s base oils demand.· Improving sentiment about Europe’s economic outlook could provide further support.· Investor sentiment and expectations in eurozone rebound sharply in March 2025, according to latest Sentix survey. .· Rising base oils margins in Asia and Europe point to some such signs of firmer supply-demand fundamentals..· In US, steady domestic prices, more balanced supply, blenders’ low inventories and prospect of seasonal rise in lube consumption similarly provide strong basis for pick-up in domestic base oils demand.· Buying interest could instead be more cautious amid growing signs of uncertainty about economic outlook and impact of any tariffs.· University of Michigan consumer sentiment for US falls in March 2025 to lowest since late-2022 amid growing uncertainty about policy and economic outlook. .· Any concern that seasonal pick-up in base oils demand could lag expectations would incentivize blenders to limit their procurement plans.· Steadier base oils margins in US point to some such signs of supply-demand fundamentals that are more muted than expected, curbing refiners’ leverage to target prices that support higher margins..Global base oils margins outlook: Week of 17 March.Asia base oils demand outlook: Week of 17 March.Asia base oils supply outlook: Week of 17 March
