S Korea’s March base oil exports rise

South Korea’s base oil exports rose in March for the first time in four months, helping to cover strong demand in southeast Asia.

But the shipments were insufficient to make up for the low volumes in the first two months of the year and left exports in the first quarter at their lowest in six years.

Base oil exports of 379,560t in March rose by 9pc from 346,900t the previous month, government data showed.

But the improvement was relative.

Exports of 1.09mn t in the first quarter of the year fell from 1.28mn t during the last three months of 2021. They were also down from 1.13mn t during the first quarter of last year, when logistical issues disrupted normal flows.

The slowdown in supplies this time coincided with a surge in feedstock and competing fuel prices. The higher prices squeezed base oil margins and incentivized refiners to produce more diesel instead.

Scheduled plant maintenance in the second quarter of the year raised the prospect of tighter-than-usual supply over the coming months. The upcoming work also likely curbed exports in the first quarter as refiners built stocks ahead of the shutdowns.

Domestic consumption in South Korea was also firmer during the first two months of the year. The stronger demand likely curbed the volume of supplies available for export.