· Asia’s base oils demand faces seasonal slowdown over coming weeks.· Signs of more limited build-up of surplus supplies in Q2 2024 curbs prospect of large price adjustment.· Prospect of relatively steady prices could help sustain buyers’ moves to secure regular requirements.· Buying interest shows signs of turning more to supplies for delivery later in Q3 2024, when demand typically revives.· That buying interest could provide additional price support..· China’s Group II base oils prices point to steadier supply-demand fundamentals, and firm fundamentals for heavy grades.· China’s domestic Group II heavy-grade price extends rise vs Shandong diesel prices, vs domestic N150 price and vs FOB NE Asia Group II N500 price..· Price strength points to firmer supply-demand fundamentals vs light grades and vs regional prices.· China’s domestic Group I brightstock price premium to FOB Asia brightstock prices steadies over past month after falling in April-May 2024, stays high vs typical levels in recent years..· South Korea’s base oils exports to southeast Asia rise to fifteen-month high in May 2024..· Higher shipment volumes to southeast Asia point to ongoing strength of region’s lube demand following rise in consumption in first four months of this year.· Rise in shipments from South Korea coincides with increasingly firm FOB Asia Group III prices relative to US and Europe markets..· Singapore’s base oils exports to southeast Asia hold firm so far in June 2024, contrasting slowdown in shipments to China and especially to India..· Singapore’s May bunker fuel sales rise for fifth time in six months year-on-year to four-month high.· Singapore’s average bunker fuel consumption per vessel rises in May 2024 for sixth month year-on-year to second-highest level in more than seven years..· Rising bunker fuel sales on outright basis and per vessel points to rise in Singapore’s marine lube consumption.· Rising marine lube consumption would support firm requirements for heavy-grade base oils..· CFR India Group II prices hold steady or rise vs FOB NE Asia prices for second week after falling steadily since H2 March 2024.· Steadier prices could suggest demand is starting to bottom out.· India’s base oils demand could remain more muted for now after imports rise in May to two-year high..· Surge in shipments boosts blenders’ stocks.· Falling imported cargo prices incentivize blenders to speed up consumption or sale of stocks to limit exposure to any further drop in prices..· South Korea’s May base oils exports to India rise to highest in almost three years..· Most of the shipments are likely to reach India in June 2024, raising prospect of extending country’s high imports through this month.· High shipments likely to sustain blenders’ stocks at more elevated levels.· Stocks at higher levels for longer would delay any moves to start to replenish inventories..· India’s demand for very-light grade base oils could stay more muted as blenders work down stocks and amid expectations that supply will remain readily available.· Blenders’ stocks rise in May 2024 after India’s very-light grade imports rise to two-year high..· Recent rise in regional feedstock/gasoil prices cut Asia refiners’ margins in June 2024 compared with Apil-May 2024.· But CFR India N70 premium to Singapore gasoil prices stays firm compared with early 2024 and Q3 2023.· Still-firm margins could limit any moves by Asia refiners to trim output for now..S Korea’s May base oils exports rise
· Asia’s base oils demand faces seasonal slowdown over coming weeks.· Signs of more limited build-up of surplus supplies in Q2 2024 curbs prospect of large price adjustment.· Prospect of relatively steady prices could help sustain buyers’ moves to secure regular requirements.· Buying interest shows signs of turning more to supplies for delivery later in Q3 2024, when demand typically revives.· That buying interest could provide additional price support..· China’s Group II base oils prices point to steadier supply-demand fundamentals, and firm fundamentals for heavy grades.· China’s domestic Group II heavy-grade price extends rise vs Shandong diesel prices, vs domestic N150 price and vs FOB NE Asia Group II N500 price..· Price strength points to firmer supply-demand fundamentals vs light grades and vs regional prices.· China’s domestic Group I brightstock price premium to FOB Asia brightstock prices steadies over past month after falling in April-May 2024, stays high vs typical levels in recent years..· South Korea’s base oils exports to southeast Asia rise to fifteen-month high in May 2024..· Higher shipment volumes to southeast Asia point to ongoing strength of region’s lube demand following rise in consumption in first four months of this year.· Rise in shipments from South Korea coincides with increasingly firm FOB Asia Group III prices relative to US and Europe markets..· Singapore’s base oils exports to southeast Asia hold firm so far in June 2024, contrasting slowdown in shipments to China and especially to India..· Singapore’s May bunker fuel sales rise for fifth time in six months year-on-year to four-month high.· Singapore’s average bunker fuel consumption per vessel rises in May 2024 for sixth month year-on-year to second-highest level in more than seven years..· Rising bunker fuel sales on outright basis and per vessel points to rise in Singapore’s marine lube consumption.· Rising marine lube consumption would support firm requirements for heavy-grade base oils..· CFR India Group II prices hold steady or rise vs FOB NE Asia prices for second week after falling steadily since H2 March 2024.· Steadier prices could suggest demand is starting to bottom out.· India’s base oils demand could remain more muted for now after imports rise in May to two-year high..· Surge in shipments boosts blenders’ stocks.· Falling imported cargo prices incentivize blenders to speed up consumption or sale of stocks to limit exposure to any further drop in prices..· South Korea’s May base oils exports to India rise to highest in almost three years..· Most of the shipments are likely to reach India in June 2024, raising prospect of extending country’s high imports through this month.· High shipments likely to sustain blenders’ stocks at more elevated levels.· Stocks at higher levels for longer would delay any moves to start to replenish inventories..· India’s demand for very-light grade base oils could stay more muted as blenders work down stocks and amid expectations that supply will remain readily available.· Blenders’ stocks rise in May 2024 after India’s very-light grade imports rise to two-year high..· Recent rise in regional feedstock/gasoil prices cut Asia refiners’ margins in June 2024 compared with Apil-May 2024.· But CFR India N70 premium to Singapore gasoil prices stays firm compared with early 2024 and Q3 2023.· Still-firm margins could limit any moves by Asia refiners to trim output for now..S Korea’s May base oils exports rise