· Asia’s base oils prices stay unusually firm relative to regional gasoil prices, especially for the time of year.· High margins point to still-firm supply-demand fundamentals.· Asia’s base oils supply could slip in Aug 2024 from previous month amid signs of slowdown in shipments from Singapore and Taiwan.· Supply could be trimmed further as open arbitrage to Americas sustains incentive to move more shipments to that region. .· Singapore’s base oils exports over last four weeks extend slowdown vs July 2024, especially to India and southeast Asia..· Taiwan’s base oils exports show signs of slowing sharply this month from July 2024, although more cargoes move to China.· Pick-up in shipments could point to tighter supply and ongoing demand from domestic buyers that have less flexibility to switch to other suppliers in the short term.· Slowdown in Taiwan's shipments this month follow rise in exports to six-month high in July 2024 amid surge in shipments to southeast Asia, India and UAE.· This month's rise in shipments to China comes after Taiwan's July base oils exports to China account for less than 25% of its total shipments for a second month..· Any extension of that trend would add to competition for market share in key southeast Asian outlets like Indonesia.· Drop in Taiwan’s shipments to China in June-July 2024 coincides with and could be a factor supporting wider gap between domestic Chinese Group II prices and FOB NE Asia prices..· South Korea’s base oils exports stay lower than usual in July 2024 even as they improve from June 2024..· Exports stay lower than usual even as South Korea’s base oils output holds stays high in May-June 2024.· Diverging trend points to build-up of surplus supplies or diversion of some of the supplies into the diesel pool.· Signs of stock-building would precede the planned shutdown of a key Group II base oils unit in South Korea starting in Sept 2024.· Any such stock-building would cushion the impact of the plant maintenance work..Asia base oils demand outlook: Week of 19 Aug.Taiwan’s July base oils exports rise.S Korea July base oils exports stay lower
