Asia’s base oils supply rose to a nine-month high in May and exports to a fourteen-month high that added to buyers’ growing inventories in markets like India.The rise in supply and buyers’ stocks triggered a subsequent slowdown in demand.Rising supply and lower demand raised the prospect of a build-up of surplus volumes by the end of the second quarter of the year.A slowdown in base oils exports from key sources like Singapore and Taiwan in June could curb the size of any such supply-build.Even so, Asia’s base oils prices fell sharply relative to feedstock and competing fuel prices in June and early July.The lower margins contrasted with steadier price levels in the US and Europe.The diverging price trends pointed to a larger surplus in Asia and more balanced supply fundamentals in those other markets in recent weeks.Asia’s base oils supply rebounded to more than 950,000 tonnes in May, government and industry data showed.The volume excluded China.The volume rose from less than 840,000 tonnes in April to the highest since last August.Supply also rose in May from year-earlier levels for the first time in six months.Lower supply in the intervening months contrasted with relatively firm lube demand in Asia, leaving a smaller-than-usual build-up of surplus supplies in the first four months of the year.The rise in supply supported a rebound in Asia’s base oils exports to more than 700,000 tonnes in May and the highest since Q1 2023.The rise in exports boosted buyers’ stocks in markets like southeast Asia and India.The higher inventories in turn triggered a slowdown in demand for replenishment supplies and an increasingly unworkable arbitrage to markets like India and Middle East through the rest of the second quarter of the year.The arbitrage stayed shut at the start of the third quarter of the year. But Group II price levels in destination markets like India have begun to rise in recent weeks compared with FOB NE Asia prices..S Korea’s May base oils output recovers.Thailand’s May base oils supply rises.Japan’s May base oils supply lags demand
Asia’s base oils supply rose to a nine-month high in May and exports to a fourteen-month high that added to buyers’ growing inventories in markets like India.The rise in supply and buyers’ stocks triggered a subsequent slowdown in demand.Rising supply and lower demand raised the prospect of a build-up of surplus volumes by the end of the second quarter of the year.A slowdown in base oils exports from key sources like Singapore and Taiwan in June could curb the size of any such supply-build.Even so, Asia’s base oils prices fell sharply relative to feedstock and competing fuel prices in June and early July.The lower margins contrasted with steadier price levels in the US and Europe.The diverging price trends pointed to a larger surplus in Asia and more balanced supply fundamentals in those other markets in recent weeks.Asia’s base oils supply rebounded to more than 950,000 tonnes in May, government and industry data showed.The volume excluded China.The volume rose from less than 840,000 tonnes in April to the highest since last August.Supply also rose in May from year-earlier levels for the first time in six months.Lower supply in the intervening months contrasted with relatively firm lube demand in Asia, leaving a smaller-than-usual build-up of surplus supplies in the first four months of the year.The rise in supply supported a rebound in Asia’s base oils exports to more than 700,000 tonnes in May and the highest since Q1 2023.The rise in exports boosted buyers’ stocks in markets like southeast Asia and India.The higher inventories in turn triggered a slowdown in demand for replenishment supplies and an increasingly unworkable arbitrage to markets like India and Middle East through the rest of the second quarter of the year.The arbitrage stayed shut at the start of the third quarter of the year. But Group II price levels in destination markets like India have begun to rise in recent weeks compared with FOB NE Asia prices..S Korea’s May base oils output recovers.Thailand’s May base oils supply rises.Japan’s May base oils supply lags demand