· Global base oils values extend rise vs feedstock/competing fuel prices to levels that insinuate increasingly tight supply-demand fundamentals.· Any signs of supply-demand fundamentals that are less tight than base oils margins imply could put pressure on margins to reflect the less tight fundamentals.· FOB Asia Group I/II price premium to Singapore gasoil extends rise, especially for heavy grades..· Group II heavy-grade premium to gasoil rises to highest since early June and close to highest in more than two years.· Premium extends rise at a time of year when it typically faces downward pressure.· Rising premium points to increasingly tight supply-demand fundamentals, incentivizes refiners to boost heavy-grade output.· Demand would need to be firm and to stay firm to avoid a subsequent supply-build..· China’s domestic Group II light-grade price premium to Shandong diesel prices holds firm..· China’s domestic Group II heavy-grade premium to Shandong diesel prices extends rise to highest in more than two years.· Firm-to-strong base oils values point to sufficient demand and limited surplus, incentivizing refiners to maintain or increase output..· CFR India Group II N70 premium to Singapore gasoil prices extends rise to three-month high..· Rising premium contrasts with N70 discount to gasoil prices the same time a year earlier.· Rising premium keeps arbitrage open, raising prospect of firm demand for very-light-grade supplies.· Rising premium incentivizes refiners to maintain higher base oils output and firm price offers relative to gasoil prices..· Europe’s Group I domestic/export price premium to VGO holds close to highest in more than a year even with lower outright prices.· Europe’s Group II N150 premium to VGO extends rise to highest in more than a year, and N500/600 premium to highest since start of this year..· Rising premium points to increasingly firm supply-demand fundamentals, incentivizing refiners to target Europe with more supplies..· US domestic Group II light-grade base oils premium to VGO extends rise to highest in more than a year.· US export Group II light-grade base oils price premium to VGO extends rise to highest since Q4 2022..· Weakness of US heating oil premium to crude magnifies relative strength of base oils premium to VGO.· Strength of base oils premium points to increasingly tight supply-demand fundamentals.· Any signs of demand that is insufficient to absorb supply could put pressure on the base oils premium to reflect less tight supply-demand fundamentals..Asia base oils demand outlook: Week of 26 Aug.Asia base oils supply outlook: Week of 26 Aug
· Global base oils values extend rise vs feedstock/competing fuel prices to levels that insinuate increasingly tight supply-demand fundamentals.· Any signs of supply-demand fundamentals that are less tight than base oils margins imply could put pressure on margins to reflect the less tight fundamentals.· FOB Asia Group I/II price premium to Singapore gasoil extends rise, especially for heavy grades..· Group II heavy-grade premium to gasoil rises to highest since early June and close to highest in more than two years.· Premium extends rise at a time of year when it typically faces downward pressure.· Rising premium points to increasingly tight supply-demand fundamentals, incentivizes refiners to boost heavy-grade output.· Demand would need to be firm and to stay firm to avoid a subsequent supply-build..· China’s domestic Group II light-grade price premium to Shandong diesel prices holds firm..· China’s domestic Group II heavy-grade premium to Shandong diesel prices extends rise to highest in more than two years.· Firm-to-strong base oils values point to sufficient demand and limited surplus, incentivizing refiners to maintain or increase output..· CFR India Group II N70 premium to Singapore gasoil prices extends rise to three-month high..· Rising premium contrasts with N70 discount to gasoil prices the same time a year earlier.· Rising premium keeps arbitrage open, raising prospect of firm demand for very-light-grade supplies.· Rising premium incentivizes refiners to maintain higher base oils output and firm price offers relative to gasoil prices..· Europe’s Group I domestic/export price premium to VGO holds close to highest in more than a year even with lower outright prices.· Europe’s Group II N150 premium to VGO extends rise to highest in more than a year, and N500/600 premium to highest since start of this year..· Rising premium points to increasingly firm supply-demand fundamentals, incentivizing refiners to target Europe with more supplies..· US domestic Group II light-grade base oils premium to VGO extends rise to highest in more than a year.· US export Group II light-grade base oils price premium to VGO extends rise to highest since Q4 2022..· Weakness of US heating oil premium to crude magnifies relative strength of base oils premium to VGO.· Strength of base oils premium points to increasingly tight supply-demand fundamentals.· Any signs of demand that is insufficient to absorb supply could put pressure on the base oils premium to reflect less tight supply-demand fundamentals..Asia base oils demand outlook: Week of 26 Aug.Asia base oils supply outlook: Week of 26 Aug
