South Korea’s base oils output rose to a one-year high in July following the completion of a protracted round of plant-maintenance work.The country’s base oils exports edged lower in July from the previous month even with the pick-up in output.The dynamic partly reflected firm domestic demand and a sharp supply-shortfall in June that incentivized a round of stock-replenishment following plant-maintenance work.The trend is unlikely to repeat itself in August following the replenishment of depleted inventories and amid a seasonal slowdown in demand.An extension of the recovery in base oils output in August could then trigger a pick-up in exports or add to already-replenished domestic stocks.South Korea’s base oils output came to 2.75 million barrels (387,000 tonnes) in July, industry data showed..The volume rose from 2.47 million barrels in June to the highest since July 2024.Output mostly held at lower levels in the intervening months since then because of a protracted round of plant-maintenance that began at the end of the third quarter of last year and ended in late-June.Unexpected production issues then kept output at lower levels during the few months when there was a pause in plant-maintenance work..South Korea’s lower base oils output was a key factor that kept Asia’s base oils supply-demand fundamentals tighter than usual so far this year.Asia’s firm Group II base oils margins in first-half 2025 reflected those tight fundamentals.The lack of any scheduled plant-maintenance work in South Korea over the coming months by contrast raised the prospect of higher output levels.Asia’s base oils margins remained firm so far in the third quarter, even if down from peak levels in the second quarter of the year.The firm margins incentivized refiners to maintain higher output levels.The dynamic put the onus on regional demand holding firm to absorb any subsequent pick-up in supplies..S Korea’s July base oils exports stay low.Asia’s June lube demand recovers.Base Oil News stories and analysis also available on ICIS platform
