Global base oils - week of Oct 30: Price outlook - margins

·        Global base oils prices trend higher vs competing/feedstock fuels, ICIS data shows.

·        Higher margins coincide with weaker gasoil values vs crude oil.

·        Diverging trends could incentivize refiners to maintain or raise base oils output.

·        Asia base oils prices resume rise vs regional gasoil prices to highest in more than three months.

·        Only Group I light-grade prices stay at discount to regional gasoil prices.

·        Domestic Chinese Group II light-grade price premium to Shandong diesel prices holds firm at highest since early July 2023, similar to year-earlier levels.

·        Domestic Chinese Group II light-grade premium to diesel prices then surged in Nov-Dec 2022.

·        Europe’s Group I price-premium to gasoil moves close to highest since 1H July 2023, up more than $150/t since mid-Sep 2023.

·        Europe’s Group II price-premium to gasoil rises close to highest since 2H July 2023.

·        Europe’s Group III price-premium to gasoil holds close to lowest since Q3 2022.

·        Europe’s Group I price-premium to VGO trends up, above average level for 2023.

·        Europe’s Group II price-premium to VGO trends up, still close to $100/t below average level for 2023.

·        US Group II light-grade export prices maintain premium to heating oil, steep premium to average levels in 2023; premium stays well below average levels in 2022.

·        US light-grade domestic price premium to VGO extends rise to highest since end-Q2 2023.

·        US Group III price premium to VGO stays close to lowest since Q2 2022, almost $200/t below average levels for 2023.

·        US Group II light/heavy-grade posted price premium to heating oil holds firm.