Base oils supply in the Americas, Europe and Asia markets rose to a five-month high in January mostly because of a rebound in output in the Asia-Pacific region.Base oils output also rose in Latin America and Europe, while production in the US fell.US base oils prices fell sharply relative to prices in Europe and Asia in February, even with the drop in US base oils output in January.Rising output in Latin America and Asia at the start of the year curbed the need for buyers in those regions to turn to other markets for additional arbitrage shipments.The healthy availability complicated the removal of rising surplus volumes from the US.Suppliers in that market cut export prices in response to levels that incentivized overseas buyers to procure their shipments instead.The competitive US prices, tighter-than-expected supply in Asia in February, and a seasonal rise in lube consumption in that region in the month of March, duly boosted demand for surplus US volumes.Base oils supply in the Americas, Europe and Asia combined came to around 2 million tonnes in January, government and industry data showed.The volume rose less than 1% from the previous month to the highest since last August.Including China and supplies from the Mideast Gulf, total supply of more than 2.70 million tonnes in January slipped from closer to 2.80 million tonnes the previous month.Asia’s higher base oils output in January from the previous month outpaced slightly the rise in the region’s lube demand.Higher output in Europe in January lagged the rise in the region’s lube demand that month.Latin America’s base oils output rose faster than the pick-up in the region’s lube demand in January.A fall in US output in January contrasted with a rebound in domestic base oils and lube demand that month..Asia’s January base oils supply rises.Latam January lube demand holds firm.US’ January base oils supply falls
