· Asia’s base oils prices hold firm vs Singapore gasoil prices, especially for heavy grades.· Firm margins incentivize refiners to raise or maintain higher base oils output at a time when demand faces seasonal slowdown, raising prospect of pick-up in surplus supply.· Sustained strength of base oils margins points to still-tight supply-demand fundamentals even with incentive for refiners to raise output..· Arbitrage to move cargoes from Asia to more distant markets stays hard to work, keeping more supplies within the region.· Arbitrage to move cargoes to Asia from more distant markets gets more feasible..· Discount of US Group II export prices to CFR India prices holds at levels that show signs of slowing for now any such arbitrage shipments.· Any such shipments would be unlikely to reach India until well into Q1 2025.· Lack of any such shipments for now would curb speed of any supply-build in Asia-Pacific region.· Taiwan’s base oils exports gather pace in H2 Nov 2024, with total shipments last month likely to exceed Oct 2024 volumes.· More than half the volume moves to southeast Asia and India, with China-bound volume staying low..· Singapore’s base oils exports rebound in past week, stay in narrow, lower range over past four weeks..· Lower volume points to dip in Singapore’s total exports in Nov 2024 from previous month.· Singapore’s base oils re-exports rise in past week to highest in more than a year.· Re-exports in past four weeks account for largest share of total exports in more than a year..· Re-exports’ rising share of total exports follows jump in Singapore imports from Netherlands since mid-Oct 2024.· Singapore’s base oils imports from China slump in past four weeks..· Fall in shipments contrasts with rising flows from China over past year.· Fall in shipments follows closure of Group I plant in China in Oct 2024.· Fall in shipments could point to even tighter availability of Group I supplies in southeast Asia..· Japan’s base oils output recovers to three-month high in Oct 2024, pointing to completion of recent plant maintenance..· Output still falls from year-earlier levels, stays much lower than in recent years.· Lower output sustains Japan’s growing reliance on imports, limits size of any recovery in exports..· India’s base oils output stays unusually low in Oct 2024 for third time in four months..· Lower output points to additional plant maintenance or production issues.· Lower output precedes expected sharp rise in production in coming year when new capacity comes online.· Expected rise in output in coming months likely to coincide with pick-up in availability of surplus base oils shipments from overseas markets.· India likely to be key target market for large portion of those surplus volumes..· Asia base oils imports from Qatar rise to eleven-month high in Oct 2024..· Rise in Asia’s imports in Sept-Oct 2024 follows sharp slowdown in total shipments from Qatar to key global outlets in July-Aug 2024.· Rise in Asia’s imports points to extension of recovery in total shipments from Qatar at start of Q4 2024.· Rise in shipments from Qatar would add to plentiful availability globally of premium-grade base oils..· Saudi Arabia’s base oils shipments from ports of Yanbu and Jeddah fall to three-month low in Oct 2024..· Signs of rebound in shipments from the two ports in Nov 2024 would add to pick-up in supply from Asia during final two months of 2024.· Less feasible arbitrage to outlets like Americas could leave more supplies from Saudi Arabia targeting markets like Middle East and India. .Japan’s October base oils output rises.Saudi Arabia’s Oct Yanbu/Jeddah exports fall.Asia base oils demand outlook: Week of 2 Dec
· Asia’s base oils prices hold firm vs Singapore gasoil prices, especially for heavy grades.· Firm margins incentivize refiners to raise or maintain higher base oils output at a time when demand faces seasonal slowdown, raising prospect of pick-up in surplus supply.· Sustained strength of base oils margins points to still-tight supply-demand fundamentals even with incentive for refiners to raise output..· Arbitrage to move cargoes from Asia to more distant markets stays hard to work, keeping more supplies within the region.· Arbitrage to move cargoes to Asia from more distant markets gets more feasible..· Discount of US Group II export prices to CFR India prices holds at levels that show signs of slowing for now any such arbitrage shipments.· Any such shipments would be unlikely to reach India until well into Q1 2025.· Lack of any such shipments for now would curb speed of any supply-build in Asia-Pacific region.· Taiwan’s base oils exports gather pace in H2 Nov 2024, with total shipments last month likely to exceed Oct 2024 volumes.· More than half the volume moves to southeast Asia and India, with China-bound volume staying low..· Singapore’s base oils exports rebound in past week, stay in narrow, lower range over past four weeks..· Lower volume points to dip in Singapore’s total exports in Nov 2024 from previous month.· Singapore’s base oils re-exports rise in past week to highest in more than a year.· Re-exports in past four weeks account for largest share of total exports in more than a year..· Re-exports’ rising share of total exports follows jump in Singapore imports from Netherlands since mid-Oct 2024.· Singapore’s base oils imports from China slump in past four weeks..· Fall in shipments contrasts with rising flows from China over past year.· Fall in shipments follows closure of Group I plant in China in Oct 2024.· Fall in shipments could point to even tighter availability of Group I supplies in southeast Asia..· Japan’s base oils output recovers to three-month high in Oct 2024, pointing to completion of recent plant maintenance..· Output still falls from year-earlier levels, stays much lower than in recent years.· Lower output sustains Japan’s growing reliance on imports, limits size of any recovery in exports..· India’s base oils output stays unusually low in Oct 2024 for third time in four months..· Lower output points to additional plant maintenance or production issues.· Lower output precedes expected sharp rise in production in coming year when new capacity comes online.· Expected rise in output in coming months likely to coincide with pick-up in availability of surplus base oils shipments from overseas markets.· India likely to be key target market for large portion of those surplus volumes..· Asia base oils imports from Qatar rise to eleven-month high in Oct 2024..· Rise in Asia’s imports in Sept-Oct 2024 follows sharp slowdown in total shipments from Qatar to key global outlets in July-Aug 2024.· Rise in Asia’s imports points to extension of recovery in total shipments from Qatar at start of Q4 2024.· Rise in shipments from Qatar would add to plentiful availability globally of premium-grade base oils..· Saudi Arabia’s base oils shipments from ports of Yanbu and Jeddah fall to three-month low in Oct 2024..· Signs of rebound in shipments from the two ports in Nov 2024 would add to pick-up in supply from Asia during final two months of 2024.· Less feasible arbitrage to outlets like Americas could leave more supplies from Saudi Arabia targeting markets like Middle East and India. .Japan’s October base oils output rises.Saudi Arabia’s Oct Yanbu/Jeddah exports fall.Asia base oils demand outlook: Week of 2 Dec
