· Group III 8cSt base oils prices strengthen vs Group III 4cSt base oils in US, Europe and Asia since Q2 2024..· Group III 8cSt price differential vs 4cSt strengthens to firmest level since H1 2022 in Europe, to highest in at least six years in the US and to highest in three years in Asia..· Rising Group III 8cSt price differential points to firmer supply-demand fundamentals for the product.· Group III 8cSt base oils price differential vs Group II heavy grades weakens in Europe and Asia; differential stays at steep discount to heavy grades in US..· Group III 8cSt premium to Group II N500 falls to narrowest in more than two years in Europe.· Group III 8cSt stays at discount of more than $50/tonne to Group II N500 in Asia since Q2 2024, down from premium to Group II N500 in 2023.· Group III 8cSt maintains wide discount to Group II heavy grades in US since mid-2022.· Weak or weaker Group III 8cSt price differential to Group II heavy grades points to weaker supply-demand fundamentals for the Group III product..· Firmer Group III 8cSt price differential to 4cSt base oils and weaker 8cSt price differential to Group II heavy grades could also reflect extension of relative tightness of heavier grades compared with light grades.· Group II heavy-grade premium to Group II light grades in Asia rises to widest in three years.· Group II heavy-grade premium to Group II light grades in Europe rises to widest since end-2022..· Group II heavy-grade premium to Group II light grades in US stays higher than in Europe and in Asia even after narrowing steadily from unusually high levels in mid-2023.· Strength of Group II heavy grades could be one factor supporting firmer demand for Group III 8cSt base oils.· Weaker Group III 8cSt price differential to Group II heavy grades makes more feasible the option of using more of the Group III supplies instead..· Firmer demand for Group III 8cSt base oils in turn magnifies impact of any change in supply of the product.· India’s imports of Group III 8cSt base oils rebound more than 40% in first nine months of 2024..· Rise in shipments coincides with wider FOB Asia Group III 8cSt discount to Group II heavy-grade prices, boosting attraction of 8cSt supplies.· Rise in shipments to India cuts supply for other markets.· Any scheduled or unplanned Group III refinery maintenance work cuts supply further..· Weaker Group III 8cSt differential vs Group II heavy grades coincides with narrower Group III 4cSt premium to Group II light grades.· Weaker Group III 4cSt/8cSt differentials point to more plentiful supply of Group III base oils.· Weaker Group III differentials provide blenders with additional light and heavier-grade supply options at competitive price levels for their lubricants formulations..Global base oils margins outlook: Week of 18 Nov.Asia base oils demand outlook: Week of 18 Nov.Asia base oils supply outlook: Week of 18 Nov
