· Global base oils values rise vs feedstock/competing fuel prices.· Firmer base oils values contrast with lower gasoil premium to crude oil, magnifying impact of rising base oils premium.· Rising base oils premium points to firm supply-demand fundamentals, especially in Europe and Asia..· Asia’s light/heavy-grade base oils prices extend rise vs Singapore gasoil to increasingly firm levels..· Increasingly firm margins incentivize refiners to boost output.· Sustained strength of heavy-grade margins suggests supply stays tight even with incentive to raise output, while demand holds firm.· Margins could face pressure from any improvement in supply or weaker demand.· Any such signs of weaker fundamentals, combined with still-firm margins, could speed up pick-up in surplus supply..· China’s domestic Group II N150 premium to Shandong diesel price extends recovery to highest since end-Jan 2025..· Firmer Group II N150 premium points to steadier supply-demand fundamentals, coincides with maintenance work on key base oils unit in China..· CFR India Group II N70 premium to Singapore gasoil steadies, holding close to highest since Q3 2024..· Firm N70 premium facilitates arbitrage, boosts attraction for overseas refiners to offer more very-light-grade base oils for export.· Firm N70 premium coincides with weaker gasoil premium to crude oil, adding to attraction of producing and selling more very-light-grade base oils..· Europe’s Group II base oils premium to vacuum gasoil (VGO) extends rise, with light-grade premium climbing to highest since end-Oct 2024..· Europe Group II margins rise at faster pace than Group I and Group III base oils.· Rebounding Group II margins point to firm supply-demand fundamentals, incentivizing refiners to boost output or move more supplies to Europe..· US Group II domestic light-grade premium to VGO rises to highest since Nov 2024, outpacing steadier export-price premium to VGO..· US Group II base oils margins hold well above year-earlier levels, pointing to firmer supply-demand fundamentals so far this year.· US Group II margins lag stronger rebound in Europe and Asia.· Dynamic points to weaker supply-demand fundamentals in US than in Europe and Asia..Asia base oils demand outlook: Week of 17 March.Asia base oils supply outlook: Week of 17 March
