· US and Europe domestic base oils prices stay under pressure vs feedstock/competing fuel prices.· Trend maintains pressure on refiners to raise prices or trim supply.· US and Europe export prices extend rise vs feedstock/competing fuel prices, cushioning impact of weak domestic margins in US especially.· Asia’s base oils prices mostly hold relatively firm versus regional gasoil prices even as they edge lower.· FOB NE Asia Group II N500 price premium to gasoil holds close to highest since June 2023, but well below year-earlier levels.· FOB NE Asia Group II N150 price premium to gasoil stays relatively low and much lower than year-earlier levels..· Lower premiums vs year-earlier levels, especially for light grades, curbs attraction for refiners to raise output..· China’s domestic Group II N150 price premium to Shandong diesel prices holds steady, around same level as at start of 2024 but well below year-earlier levels..· Premium holds at levels that point to relatively balanced supply-demand dynamics, curb risk of major supply-build..· CFR India N70 premium to Singapore gasoil prices falls, holds in $100-150/tonne range since early Dec 2023..· Premium stays at levels that sustain incentive for refiners to maintain output of the product rather than redirect it back into the diesel pool..· Europe’s domestic Group I prices stay unusually weak vs gasoil and VGO prices even with rise in outright prices.· Europe’s Group II light-grade price premium to VGO extends fall to lowest since Oct 2023.· Europe’s Group III 4cSt (low) price premium to VGO holds close to lowest since June 2022..· Sustained price weakness of Group I, Group II and Group III base oils points to weak supply-demand fundamentals, deters refiners from increasing supply.· Europe’s Group I export price premium to VGO extends rebound to highest since start of 2024, contrasting with relative weakness of Group I domestic prices..· US domestic base oils prices extend fall vs heating oil/VGO even as outright prices rise.· US domestic Group II light-grade price premium to VGO falls to lowest since March 2022.· US domestic Group III 4cSt premium to VGO slumps to lowest since March 2021..· Sliding price premiums curb incentive for refiners to maintain or raise current output levels.· US Group II posted price premium to VGO stays under pressure at lowest since Sept 2023 even after recent round of price-increases.· Ongoing pressure on margins could prompt refiners to adjust prices again if crude/VGO prices hold onto recent gains.· US Group II export price premium to heating oil/VGO extends rise, mirroring similar trend in Europe.· US’ growing volume of exports as share of total supply increases impact of rising margins for base oil exports..Global base oils demand outlook - week of April 1
· US and Europe domestic base oils prices stay under pressure vs feedstock/competing fuel prices.· Trend maintains pressure on refiners to raise prices or trim supply.· US and Europe export prices extend rise vs feedstock/competing fuel prices, cushioning impact of weak domestic margins in US especially.· Asia’s base oils prices mostly hold relatively firm versus regional gasoil prices even as they edge lower.· FOB NE Asia Group II N500 price premium to gasoil holds close to highest since June 2023, but well below year-earlier levels.· FOB NE Asia Group II N150 price premium to gasoil stays relatively low and much lower than year-earlier levels..· Lower premiums vs year-earlier levels, especially for light grades, curbs attraction for refiners to raise output..· China’s domestic Group II N150 price premium to Shandong diesel prices holds steady, around same level as at start of 2024 but well below year-earlier levels..· Premium holds at levels that point to relatively balanced supply-demand dynamics, curb risk of major supply-build..· CFR India N70 premium to Singapore gasoil prices falls, holds in $100-150/tonne range since early Dec 2023..· Premium stays at levels that sustain incentive for refiners to maintain output of the product rather than redirect it back into the diesel pool..· Europe’s domestic Group I prices stay unusually weak vs gasoil and VGO prices even with rise in outright prices.· Europe’s Group II light-grade price premium to VGO extends fall to lowest since Oct 2023.· Europe’s Group III 4cSt (low) price premium to VGO holds close to lowest since June 2022..· Sustained price weakness of Group I, Group II and Group III base oils points to weak supply-demand fundamentals, deters refiners from increasing supply.· Europe’s Group I export price premium to VGO extends rebound to highest since start of 2024, contrasting with relative weakness of Group I domestic prices..· US domestic base oils prices extend fall vs heating oil/VGO even as outright prices rise.· US domestic Group II light-grade price premium to VGO falls to lowest since March 2022.· US domestic Group III 4cSt premium to VGO slumps to lowest since March 2021..· Sliding price premiums curb incentive for refiners to maintain or raise current output levels.· US Group II posted price premium to VGO stays under pressure at lowest since Sept 2023 even after recent round of price-increases.· Ongoing pressure on margins could prompt refiners to adjust prices again if crude/VGO prices hold onto recent gains.· US Group II export price premium to heating oil/VGO extends rise, mirroring similar trend in Europe.· US’ growing volume of exports as share of total supply increases impact of rising margins for base oil exports..Global base oils demand outlook - week of April 1