· Global base oils prices rise versus crude and diesel, reflecting lag in any price-adjustment following last week’s sharp slide in crude oil prices, ICIS data showed.· This week’s crude price recovery raises prospect of base oils prices holding firm for now.· Any extended time-lag would maintain the wider base oils premium to crude/diesel unless crude prices extend this week’s recovery.· A wider base oils premium to crude/diesel would incentivize refiners to maintain or increase base oils output.· Any such adjustment to production would coincide with seasonal slowdown in demand in most markets in coming weeks.· Any sustained recovery in base oils values vs crude/diesel would leave refiners facing choice of responding to rebounding base oils margins by raising output or responding to prospect of seasonal slowdown in demand by cutting output.· Steady outright Asia base oils prices trigger rise in premium versus lower feedstock and gasoil prices.· Steady-to-firm outright prices reflect current balanced-to-tight supply-demand fundamentals.· Strong rise in Asia base oils margins insinuate tight supply and strong demand, raising prospect of rise in supply in response.· Such a move raises risk of build-up of surplus supply, leaving refiners with less leverage to adjust prices..· Europe’s base oils prices rebound versus gasoil to highest in more than two months, from lowest in Sep 2023 at least since start of the year.· Europe’s domestic Group I base oils prices recover from five-month low versus to VGO at end-Sep 2023 to highest in more than a month..· Europe’s Group III 4cst (low) price versus VGO extends fall to lowest since June 2022 as outright prices extend fall..· US base oils prices rebound vs heating oil to highest in more than two months.· US Group II light-grade export price rebounds to steep premium to heating oil.· US Group II light-grade premium to VGO rises to highest in almost two months..· US Group II light-grade posted price premium to heating oil rebounds to highest since early-June 2023..Global base oils - week of Oct 2: Demand outlook
· Global base oils prices rise versus crude and diesel, reflecting lag in any price-adjustment following last week’s sharp slide in crude oil prices, ICIS data showed.· This week’s crude price recovery raises prospect of base oils prices holding firm for now.· Any extended time-lag would maintain the wider base oils premium to crude/diesel unless crude prices extend this week’s recovery.· A wider base oils premium to crude/diesel would incentivize refiners to maintain or increase base oils output.· Any such adjustment to production would coincide with seasonal slowdown in demand in most markets in coming weeks.· Any sustained recovery in base oils values vs crude/diesel would leave refiners facing choice of responding to rebounding base oils margins by raising output or responding to prospect of seasonal slowdown in demand by cutting output.· Steady outright Asia base oils prices trigger rise in premium versus lower feedstock and gasoil prices.· Steady-to-firm outright prices reflect current balanced-to-tight supply-demand fundamentals.· Strong rise in Asia base oils margins insinuate tight supply and strong demand, raising prospect of rise in supply in response.· Such a move raises risk of build-up of surplus supply, leaving refiners with less leverage to adjust prices..· Europe’s base oils prices rebound versus gasoil to highest in more than two months, from lowest in Sep 2023 at least since start of the year.· Europe’s domestic Group I base oils prices recover from five-month low versus to VGO at end-Sep 2023 to highest in more than a month..· Europe’s Group III 4cst (low) price versus VGO extends fall to lowest since June 2022 as outright prices extend fall..· US base oils prices rebound vs heating oil to highest in more than two months.· US Group II light-grade export price rebounds to steep premium to heating oil.· US Group II light-grade premium to VGO rises to highest in almost two months..· US Group II light-grade posted price premium to heating oil rebounds to highest since early-June 2023..Global base oils - week of Oct 2: Demand outlook