· Asia’s base oils supply shows signs of more ready availability, with firm demand in markets like India absorbing more volumes for now.· Arbitrage to move supplies from Asia to markets like the Americas and Europe stays hard to work, pointing to limited surplus for now.· FOB NE Asia Group II light-grade premium to CFR NE Asia and CFR India prices falls sharply in recent weeks.· Narrower premium complicates arbitrage to those markets.· Ex-tank Singapore Group I brightstock premium to FOB Europe export prices falls to lowest since start of 2024.· Narrowing premium raises prospect of curbing flow of additional arbitrage supplies from Europe to Asia..· China’s base oils supply shows signs of holding firm through March 2024.· Base oils exports from Taiwan rebound strongly from H2 March 2024.· Base oils exports from South Korea show signs of rising to China and rebounding to India in March 2024.· Base oils exports from Singapore show signs of recovering to more typical levels in March 2024 after unusual dip in Feb 2024..· Steady-to-higher supply in Asia would coincide with likely slowdown in regional lube demand at start of Q2 2024.· Rise in supply and slower demand raises prospect of a faster rise in regional surplus supplies during Q2 2024..· Singapore’s February base oils exports unexpectedly fall at a time of year when they usually rise..· Exports usually rise to meet seasonal pick-up in Asia’s lube demand at end of first quarter of the year.· Drop in exports instead compounds impact of slowdown in shipments from Taiwan and South Korea that month.· Drop in exports from Asia’s key suppliers likely to leave region with smaller surplus heading into Q2 2024, when demand usually eases compared with the month of March.· Singapore’s base oils imports from China show signs of recovering in March 2024.· Singapore takes delivery of additional shipments from Hong Kong and Qatar last week.· Shipments trigger unusual surge in Singapore’s imports from Hong Kong and Qatar in March 2024.· Qatar is key source of Group III+ GTL base oils; Hong Kong is a key distribution point for Qatar’s GTL base oils.· Singapore takes delivery of rare cargo from Japan last week.· Shipment is first from Japan since Oct 2023, when a Group I plant in the country was closed.· Pause in shipments from Japan since then added to tighter availability of Group I base oils in southeast Asia. · Singapore’s Group I base oils imports become more reliant on shipments from Europe and Russia than from Asia in recent months..· The trend leaves Singapore more reliant on supplies that can take several months instead of several weeks to arrive.· The trend could change again following likely closure of a Group I plant in Europe in the coming weeks..· India’s February base oils supply falls to five-month low as domestic output slides to lowest since mid-2022.· Excluding imported supplies of very-light grade base oils, India’s supply shortfall versus demand widens to more than 80,000 tonnes in Feb 2024, from around 20,000 tonnes the previous month..· Larger shortfall coincides with pick-up in India’s demand for overseas supplies in recent weeks..Asia base oils demand outlook: Week of April 1.Global base oils margins outlook - week of April 1.Global base oils arb outlook: Week of April 1
· Asia’s base oils supply shows signs of more ready availability, with firm demand in markets like India absorbing more volumes for now.· Arbitrage to move supplies from Asia to markets like the Americas and Europe stays hard to work, pointing to limited surplus for now.· FOB NE Asia Group II light-grade premium to CFR NE Asia and CFR India prices falls sharply in recent weeks.· Narrower premium complicates arbitrage to those markets.· Ex-tank Singapore Group I brightstock premium to FOB Europe export prices falls to lowest since start of 2024.· Narrowing premium raises prospect of curbing flow of additional arbitrage supplies from Europe to Asia..· China’s base oils supply shows signs of holding firm through March 2024.· Base oils exports from Taiwan rebound strongly from H2 March 2024.· Base oils exports from South Korea show signs of rising to China and rebounding to India in March 2024.· Base oils exports from Singapore show signs of recovering to more typical levels in March 2024 after unusual dip in Feb 2024..· Steady-to-higher supply in Asia would coincide with likely slowdown in regional lube demand at start of Q2 2024.· Rise in supply and slower demand raises prospect of a faster rise in regional surplus supplies during Q2 2024..· Singapore’s February base oils exports unexpectedly fall at a time of year when they usually rise..· Exports usually rise to meet seasonal pick-up in Asia’s lube demand at end of first quarter of the year.· Drop in exports instead compounds impact of slowdown in shipments from Taiwan and South Korea that month.· Drop in exports from Asia’s key suppliers likely to leave region with smaller surplus heading into Q2 2024, when demand usually eases compared with the month of March.· Singapore’s base oils imports from China show signs of recovering in March 2024.· Singapore takes delivery of additional shipments from Hong Kong and Qatar last week.· Shipments trigger unusual surge in Singapore’s imports from Hong Kong and Qatar in March 2024.· Qatar is key source of Group III+ GTL base oils; Hong Kong is a key distribution point for Qatar’s GTL base oils.· Singapore takes delivery of rare cargo from Japan last week.· Shipment is first from Japan since Oct 2023, when a Group I plant in the country was closed.· Pause in shipments from Japan since then added to tighter availability of Group I base oils in southeast Asia. · Singapore’s Group I base oils imports become more reliant on shipments from Europe and Russia than from Asia in recent months..· The trend leaves Singapore more reliant on supplies that can take several months instead of several weeks to arrive.· The trend could change again following likely closure of a Group I plant in Europe in the coming weeks..· India’s February base oils supply falls to five-month low as domestic output slides to lowest since mid-2022.· Excluding imported supplies of very-light grade base oils, India’s supply shortfall versus demand widens to more than 80,000 tonnes in Feb 2024, from around 20,000 tonnes the previous month..· Larger shortfall coincides with pick-up in India’s demand for overseas supplies in recent weeks..Asia base oils demand outlook: Week of April 1.Global base oils margins outlook - week of April 1.Global base oils arb outlook: Week of April 1
