Japan’s base oils and lube demand fell in April for a third month, mirroring a slowdown in the country’s industrial activity.Lower domestic demand freed up more base oils supplies for export, triggering a pick-up in Group I base oils shipments to South Korea and southeast Asia.The rise in exports coincided with and helped to cushion the impact of a slowdown in Group I shipments from Europe and Middle East to Asia during the second quarter of the year.Japan’s base oils and lube consumption of 127,000 kilolitres (113,000 tonnes) in April fell by 21% and for a third month from year-earlier levels, government data showed..The contraction coincided with a drop in Japan’s industrial production in April from the previous month, including a fall in motor vehicle production and automobile exports to the US.The slowdown in lube consumption highlighted the impact of US tariffs on Japan’s base oils and lubricants market despite base oils being excluded from the new tariffs.The slump in domestic lube consumption far outpaced a smaller dip in Japan’s base oils output, triggering a pick-up in surplus supplies for overseas markets.The dynamic highlighted some of the knock-on repercussions of the US tariffs as more of Japan's supplies targeted other markets instead even amid signs of weaker demand in those markets.Japan’s base oils exports of 54,200 kilolitres in April rose for a fourth month from year-earlier levels to the second-highest level since the third quarter of 2023.The closure of another of the country’s Group I base oils units later in 2023 triggered a subsequent slump in exports until the beginning of this year.The drop in shipments during that time compounded Asia’s increasingly tight supply of Group I base oils, especially of heavy-grade supplies.The recovery in Japan’s base oils exports in March and April especially helped to partially reverse that trend.The rise in shipments coincided with signs of improving availability of spot volumes of Group I base oils from other refiners in Asia in the second quarter of the year. .China’s April base oil demand holds firm.S Korea’s April base oils output rises.India's April base oils supply exceeds demand
