Japan’s base oils and lube demand rose to a six-month high in March amid a seasonal pick-up in domestic and regional consumption.Steady-to-firm domestic demand and lower supply left the country with less surplus volumes for the export market.The sharp drop in Japan's base oils exports in recent months was a key factor that has sustained persistently tight Group I supply-demand fundamentals in the Asia-Pacific market.Any stronger pick-up in Japan’s domestic base oils and lube demand would exacerbate the trend.Domestic consumption of 152,600 kilolitres (135,200 tonnes) in March rose from 148,600 kilolitres the previous month to a four-month high, government data showed.Total demand of 438,630 kilolitres in the first quarter of the year rose by 4% from 421,700 kilolitres during the same period last year.The increase in consumption contrasted with a 14% fall in Japan’s base oils output during the same three-month period.The country’s lube demand could get further support in the second quarter from an expected recovery in industrial production and firm private consumption.Japan’s industrial production fell sharply at the start of the year because of widespread automobile production stoppages.Motor vehicle production then revived strongly in March, with the recovery expected to continue in the second quarter.Japan’s domestic base oils and lube demand accounted for 78% of the country’s total base oils supply in the first quarter of the year. The share was up from 70% in 2023 and 63% in 2022.Any further increase in that share of total supply would limit even more the volume of shipments available for export.Japan’s base oils exports rose to a six-month high of 38,160 kilolitres in March. They still fell by 44% and for a seventh month from year-earlier levels.The prolonged drop in shipments left key outlets like Singapore seeking additional volumes from sources like Europe.Tighter supply and rising prices in that market now complicated any further arbitrage shipments from there.Firmer domestic and overseas consumption in March lifted Japan’s total demand, or domestic consumption and exports combined, to a six-month high of 190,760 kilolitres..Japan’s March base oils supply rises
Japan’s base oils and lube demand rose to a six-month high in March amid a seasonal pick-up in domestic and regional consumption.Steady-to-firm domestic demand and lower supply left the country with less surplus volumes for the export market.The sharp drop in Japan's base oils exports in recent months was a key factor that has sustained persistently tight Group I supply-demand fundamentals in the Asia-Pacific market.Any stronger pick-up in Japan’s domestic base oils and lube demand would exacerbate the trend.Domestic consumption of 152,600 kilolitres (135,200 tonnes) in March rose from 148,600 kilolitres the previous month to a four-month high, government data showed.Total demand of 438,630 kilolitres in the first quarter of the year rose by 4% from 421,700 kilolitres during the same period last year.The increase in consumption contrasted with a 14% fall in Japan’s base oils output during the same three-month period.The country’s lube demand could get further support in the second quarter from an expected recovery in industrial production and firm private consumption.Japan’s industrial production fell sharply at the start of the year because of widespread automobile production stoppages.Motor vehicle production then revived strongly in March, with the recovery expected to continue in the second quarter.Japan’s domestic base oils and lube demand accounted for 78% of the country’s total base oils supply in the first quarter of the year. The share was up from 70% in 2023 and 63% in 2022.Any further increase in that share of total supply would limit even more the volume of shipments available for export.Japan’s base oils exports rose to a six-month high of 38,160 kilolitres in March. They still fell by 44% and for a seventh month from year-earlier levels.The prolonged drop in shipments left key outlets like Singapore seeking additional volumes from sources like Europe.Tighter supply and rising prices in that market now complicated any further arbitrage shipments from there.Firmer domestic and overseas consumption in March lifted Japan’s total demand, or domestic consumption and exports combined, to a six-month high of 190,760 kilolitres..Japan’s March base oils supply rises
