· Diesel price premium to crude oil holds above one-year low in April, stays well below unusually high levels in Q2 2022-Q1 2023.· Firmer US diesel premium to crude and weaker light-grade base oils premium to diesel, especially for export supplies, incentivizes US refiners to pour light grades back into diesel pool.· US supply surplus likely to be smaller heading into Q3 2023 following plant maintenance work, lower prices, and sustained wave of arbitrage exports during Q2 2023.· Delivery of Group III supplies from the Mideast Gulf edge up in April as surge in shipments to US contrasts with drop in supplies to Europe and Asia..· Premium-grade supplies from Mideast Gulf fall by more than 45,000t in first four months of 2023 from year-earlier levels.· Europe’s Q1 base oils supply from domestic sources rises to more than 1.12mn t, up more than 100,000t from year-earlier levels.· Europe’s March base oils supply rebounds from February, far outpacing seasonal rise in regional demand..· Lower regional supply in Q2 2023 coincides with drop in regional demand.· Regional supply likely to revive in Q3 2023, while regional demand stays low.· Prospect of extended shutdown of a Group I base oils unit in the Mediterranean market could be key to curbing supply-build in Q3 2023.· Export volumes of Russian origin likely to revive in coming weeks following completion of plant maintenance.· Any pick-up in Russian shipments would balance out slowdown in Europe’s base oils exports since Q2 2023. · Any pick-up in Russian shipments would still leave Europe increasingly short of Group I base oils, especially if plant maintenance work continues over the coming months..· Tighter Group I supply and firmer Group I prices relative to Group II adds to attraction of using more premium-grade base oils instead.· Slowdown in Group III shipments to Europe fails to prevent growing pressure on prices in that region and globally during Q2 2023, even with plant maintenance work.· Lower supply and downward price-pressure points to demand weakness as key determinant behind weaker fundamentals.· Rise in Group III supplies for US could reflect growing supply in Mideast Gulf and need to clear volumes from region.· Europe’s April Group III base oils supplies fall ahead of plant-maintenance work in Spain in May..· Europe’s Group III base oils supply likely to revive from end-Q2 following completion of plant maintenance work.· Shipments from Saudi Arabia show signs of rebounding strongly in June, after supplies from Yanbu and Jeddah fall to eight-month low in May..Americas/Europe base oils – week of June 26: Demand outlook.Contact us for more information about the data for these stories
· Diesel price premium to crude oil holds above one-year low in April, stays well below unusually high levels in Q2 2022-Q1 2023.· Firmer US diesel premium to crude and weaker light-grade base oils premium to diesel, especially for export supplies, incentivizes US refiners to pour light grades back into diesel pool.· US supply surplus likely to be smaller heading into Q3 2023 following plant maintenance work, lower prices, and sustained wave of arbitrage exports during Q2 2023.· Delivery of Group III supplies from the Mideast Gulf edge up in April as surge in shipments to US contrasts with drop in supplies to Europe and Asia..· Premium-grade supplies from Mideast Gulf fall by more than 45,000t in first four months of 2023 from year-earlier levels.· Europe’s Q1 base oils supply from domestic sources rises to more than 1.12mn t, up more than 100,000t from year-earlier levels.· Europe’s March base oils supply rebounds from February, far outpacing seasonal rise in regional demand..· Lower regional supply in Q2 2023 coincides with drop in regional demand.· Regional supply likely to revive in Q3 2023, while regional demand stays low.· Prospect of extended shutdown of a Group I base oils unit in the Mediterranean market could be key to curbing supply-build in Q3 2023.· Export volumes of Russian origin likely to revive in coming weeks following completion of plant maintenance.· Any pick-up in Russian shipments would balance out slowdown in Europe’s base oils exports since Q2 2023. · Any pick-up in Russian shipments would still leave Europe increasingly short of Group I base oils, especially if plant maintenance work continues over the coming months..· Tighter Group I supply and firmer Group I prices relative to Group II adds to attraction of using more premium-grade base oils instead.· Slowdown in Group III shipments to Europe fails to prevent growing pressure on prices in that region and globally during Q2 2023, even with plant maintenance work.· Lower supply and downward price-pressure points to demand weakness as key determinant behind weaker fundamentals.· Rise in Group III supplies for US could reflect growing supply in Mideast Gulf and need to clear volumes from region.· Europe’s April Group III base oils supplies fall ahead of plant-maintenance work in Spain in May..· Europe’s Group III base oils supply likely to revive from end-Q2 following completion of plant maintenance work.· Shipments from Saudi Arabia show signs of rebounding strongly in June, after supplies from Yanbu and Jeddah fall to eight-month low in May..Americas/Europe base oils – week of June 26: Demand outlook.Contact us for more information about the data for these stories
