Base oils supply in the Americas, Europe and Asia markets rose to a four-month high in December at the same time as demand faced a seasonal slowdown.The contrasting dynamics triggered a rise in surplus supplies, especially in the US.Unusually low US base oils export prices and a wave of arbitrage shipments from the US so far this year reflected moves to clear the surplus.Firmer base oils prices in Asia and a less feasible arbitrage to move shipments to markets like the Americas and Europe reflected the region’s smaller surplus at the start of the year.Europe’s base oils prices held at levels that kept open the arbitrage to move cargoes from the US to the region. They also facilitated arbitrage shipments from the region to markets like Asia.The more mixed prices coincided with a rise in surplus supplies in that region at the end of last year. But the size of the surplus was smaller than in previous years.Base oils supply in the Americas, Europe and Asia combined rose to close to 2 million tonnes in December, government data showed.The volume rose from less than 1.9 million tonnes the previous month to the highest since last August.Including China and supplies from the Mideast Gulf, total supply of close to 2.8 million tonnes in December rose from less than 2.6 million tonnes in November to a seven-month high.Including those markets, total supply of less than 32 million tonnes in 2023 was down less than 0.5% from the previous year.The rise in supply in December contrasted with a fall in demand in the Americas, Europe and Asia combined to the lowest since first-half 2020.Consumption fell sharply mostly because of a steep slump in demand in the US.Consumption also faced a seasonal slowdown in Europe and Asia in December but still rose from year-earlier levels..Asia’s December base oils supply falls.Americas’ Dec base oils supply rises
Base oils supply in the Americas, Europe and Asia markets rose to a four-month high in December at the same time as demand faced a seasonal slowdown.The contrasting dynamics triggered a rise in surplus supplies, especially in the US.Unusually low US base oils export prices and a wave of arbitrage shipments from the US so far this year reflected moves to clear the surplus.Firmer base oils prices in Asia and a less feasible arbitrage to move shipments to markets like the Americas and Europe reflected the region’s smaller surplus at the start of the year.Europe’s base oils prices held at levels that kept open the arbitrage to move cargoes from the US to the region. They also facilitated arbitrage shipments from the region to markets like Asia.The more mixed prices coincided with a rise in surplus supplies in that region at the end of last year. But the size of the surplus was smaller than in previous years.Base oils supply in the Americas, Europe and Asia combined rose to close to 2 million tonnes in December, government data showed.The volume rose from less than 1.9 million tonnes the previous month to the highest since last August.Including China and supplies from the Mideast Gulf, total supply of close to 2.8 million tonnes in December rose from less than 2.6 million tonnes in November to a seven-month high.Including those markets, total supply of less than 32 million tonnes in 2023 was down less than 0.5% from the previous year.The rise in supply in December contrasted with a fall in demand in the Americas, Europe and Asia combined to the lowest since first-half 2020.Consumption fell sharply mostly because of a steep slump in demand in the US.Consumption also faced a seasonal slowdown in Europe and Asia in December but still rose from year-earlier levels..Asia’s December base oils supply falls.Americas’ Dec base oils supply rises
