Asia’s April base oil exports ease

Asia-Pacific base oil exports fell in April to the lowest this year as a combination of planned and some unexpected plant maintenance work cut supply.

Exports of 674,970t in April fell by 5pc from 710,320t the previous month and by 11pc from year-earlier levels, government data showed.

The volume was also lower than typical levels of around 692,000 t/month over the past year.

The slowdown reflected a sharp drop in supplies from Taiwan and South Korea, where some scheduled maintenance work began in April.

The drop in supplies from those markets more than countered higher shipments from Japan and Indonesia. That country’s exports rose following the completion of plant maintenance work the previous month.

Asia-Pacific base oil exports of 2.75mn t in the first four months of the year were down 6pc from 2.93mn t during the same period last year.

Supply in the Asia-Pacific region remained at healthy levels in April even with the drop in exports. Some producers even sought to move surplus volumes to more distant markets like the Mideast Gulf or Americas markets.

Asia-Pacific base oil prices also struggled to keep pace with rising crude and diesel prices and fell to increasingly steep discounts to prices in other markets like Europe.

The healthy availability partly reflected the unexpectedly weak demand from China in April. Lockdowns in the country to thwart the spread of the Covid-19 virus slashed domestic demand at a time when it typically peaks.