· Global base oils prices extend rise vs feedstock/competing fuel prices, ICIS data shows· Firming premiums insinuate tight supply-demand fundamentals, incentivizing refiners to maintain or raise base oils output.· Prospect of steady or higher output would require steady or higher demand to absorb the supplies.· Fob Asia Group I and FOB NE Asia Group II price premium to Singapore gasoil prices extends sharp rise.· FOB NE Asia Group II N500 premium rises to highest since end-2021; N150 premium rises to highest in a year..· Rising premium coincides with weaker diesel premium to crude.· Diverging trends magnify attraction for refiners to produce more base oils..· Domestic China Group II N150 premium to Shandong diesel prices holds steady, stays in narrow range since end of last year..· Steady premium this year contrasts surge in premium in Q1 2023, followed by slump in premium in Q2 2023.· Steadier premium at lower levels this year points to margins that were sufficient to limit production at levels that avoided a large supply-build..· CFR India N70 premium to Singapore gasoil prices rises to highest in six months..· Rising N70 premium sustains incentive for regional refiners to boost output of very-light grades for base oils market rather than redirect supplies into diesel pool..· Europe’s Group I base oils export price premium to VGO extends strong rebound since early March 2024.· Europe’s Group II N150 premium to VGO holds close to highest in more than four months, stays in relatively narrow range over past year.· Europe Group III 4cSt (low) premium to VGO rises to highest in more than three months, after falling sharply over past year..· Europe Group III 4cSt (low) premium to VGO remains well above Group II N150 premium to VGO, especially compared with before Q3 2022..· US Group II domestic/export price premium to VGO extends strong rebound.· US Group II N100/120 export price premium to VGO rises close to six-month high; domestic price premium rises to highest in more than five months..· US Group III 4cSt premium to VGO rises to highest since early April, lags pace of rise in Group II N100/N120 premium.· Rebounding Group II premium to VGO, and rebounding premium at faster pace than Group III base oils, boosts incentive for refiners to increase Group II base oils output..Asia base oils demand outlook: Week of 27 May.Asia base oils supply outlook: Week of 27 May
· Global base oils prices extend rise vs feedstock/competing fuel prices, ICIS data shows· Firming premiums insinuate tight supply-demand fundamentals, incentivizing refiners to maintain or raise base oils output.· Prospect of steady or higher output would require steady or higher demand to absorb the supplies.· Fob Asia Group I and FOB NE Asia Group II price premium to Singapore gasoil prices extends sharp rise.· FOB NE Asia Group II N500 premium rises to highest since end-2021; N150 premium rises to highest in a year..· Rising premium coincides with weaker diesel premium to crude.· Diverging trends magnify attraction for refiners to produce more base oils..· Domestic China Group II N150 premium to Shandong diesel prices holds steady, stays in narrow range since end of last year..· Steady premium this year contrasts surge in premium in Q1 2023, followed by slump in premium in Q2 2023.· Steadier premium at lower levels this year points to margins that were sufficient to limit production at levels that avoided a large supply-build..· CFR India N70 premium to Singapore gasoil prices rises to highest in six months..· Rising N70 premium sustains incentive for regional refiners to boost output of very-light grades for base oils market rather than redirect supplies into diesel pool..· Europe’s Group I base oils export price premium to VGO extends strong rebound since early March 2024.· Europe’s Group II N150 premium to VGO holds close to highest in more than four months, stays in relatively narrow range over past year.· Europe Group III 4cSt (low) premium to VGO rises to highest in more than three months, after falling sharply over past year..· Europe Group III 4cSt (low) premium to VGO remains well above Group II N150 premium to VGO, especially compared with before Q3 2022..· US Group II domestic/export price premium to VGO extends strong rebound.· US Group II N100/120 export price premium to VGO rises close to six-month high; domestic price premium rises to highest in more than five months..· US Group III 4cSt premium to VGO rises to highest since early April, lags pace of rise in Group II N100/N120 premium.· Rebounding Group II premium to VGO, and rebounding premium at faster pace than Group III base oils, boosts incentive for refiners to increase Group II base oils output..Asia base oils demand outlook: Week of 27 May.Asia base oils supply outlook: Week of 27 May
