· Asia’s heavy-grade base oils prices stay high versus feedstock/competing fuel prices.· High margins point to tight supply-demand fundamentals, incentivizing refiners to maintain or raise output.· Light-grade base oils prices stay low vs feedstock/competing fuel prices, cutting incentive for refiners to raise output.· Mixed price incentives coincide with ongoing and additional plant maintenance in Asia and in other regions over coming weeks.· Ongoing/additional maintenance work could limit any pick-up in supply in Q2 2025 even after completion of some plant shutdowns.· Any extended slowdown in shipments from sources like Taiwan could also keep supply more balanced.· Taiwan’s base oils exports show signs of falling in March 2025 from previous month.· Slowdown would follow unusually high shipment volumes in Jan-Feb 2025.· Asia’s Group II base oils prices hold at levels that keep arbitrage shut to markets like Latin America..· Closed arbitrage reflects tight supply, keeps any surplus volumes in Asia-Pacific region.· Asia prices hold at levels that facilitate arbitrage flows from markets like US to outlets like Middle East and India..· Plant maintenance in US and typical seasonal rise in demand in that market could curb any such flows that have already been lower than expected.· Volume of exports from US to outlets like India could face change in coming weeks if any change in import taxes impacts more typical trade flows..· Singapore’s base oils exports stay higher than usual last week for third straight week..· Exports hold at more than 50,000 tonnes/week for third week for first time in more than three years.· High shipment volumes lift total exports over last three weeks to highest since Aug 2023..· Singapore takes delivery of large shipment from US in past week..· Shipment is largest from US since May 2024.· Shipment extends larger-than-usual flow of imports from markets like Europe and US, boosting supply in southeast Asia..· South Korea’s base oils exports rebound in Feb 2025..· Exports rebound even as plant maintenance in South Korea begins at end-Feb 2025.· Rebounding exports points to release of stocks built up ahead of shutdown.· Build-up of stocks ahead of shutdown add to tighter-than-usual regional supply at start of 2025.· Build-up of stocks coincides with blenders’ moves to replenish inventories ahead of peak-demand season at end-Q1 2025.· Dynamic suggests market could have already faced largest impact of the plant maintenance..· South Korea’s base oils exports to US and Europe rebound in Feb 2025..· US and Europe are key outlets for Group III base oils from South Korea.· Rebound in shipments in Feb 2025 suggests Group III base oils were key factor behind previous drop in exports.· Any drop in Group III base oils exports would be despite scheduled plant maintenance work in South Korea from end-Feb 2025 impacting Group II base oils more than Group III..· Pick-up in South Korea’s shipments adds to rebound in base oils exports from Asia’s key suppliers in Feb 2025 to six-month high..· Rise in shipments helps blenders to replenish stocks, cover for seasonal rise in lube demand at end-Q1 2025.· Export volume could fall in March 2025 on dip in supplies from Taiwan and likely slowdown in flows from South Korea, outweighing high exports from Singapore..· Saudi Arabia’s base oils shipments from Yanbu/Jeddah fall to seven-month low in Feb 2025..· Slowdown cuts shipments to India, whose very-light-grade base oils imports from Saudi Arabia fall to five-month low in Feb 2025.· India’s imports of very-light grade base oils from Qatar by contrast surge in H1 March 2025 to highest since end-2023. .· CFR India and domestic China Group II light-grade price-discount to heavy-grade prices narrows from unusually wide levels..· Any further improvement in light-grade prices relative to heavy-grade prices could point to change in supply-demand dynamics between the two grades..India’s February base oils imports fall.S Korea’s Feb base oils exports rebound.S Korea Feb base oils exports to US rise .Asia base oils demand outlook: Week of 24 March
