South Korea’s base oils output rose in December to a seven-month high while domestic demand slowed.The trend raised the prospect of a rise in base oils exports at the start of this year.Any such increase in supply would be timely.Demand in the Asia-Pacific region remained weak in the first few weeks of this year.But a seasonal rise in lube consumption later in the first quarter raised the prospect of a pick-up in base oils requirements.The delayed buying and a revival in Chinese demand was likely to add to the subsequent rise in demand.South Korea’s base oils output of 2.80mn bl (394,000t) in December rose by 6pc from the previous month, according to Korea Petroleum Association (KPA)..Output fell from year-earlier levels for a seventh month. But the 1pc fall in production was the smallest contraction since last May.The sustained slowdown cut output to 16.14mn bl in the second half of last year. The volume was down 13pc from 18.57mn bl during the same period in 2021.The drop in output cut the supply overhang in the Asia-Pacific region, especially during the fourth quarter of the year.Surplus supply during the year had kept sustained pressure on regional base oils prices. These fell to a discount to diesel prices for three months to the beginning of December.Prices remained weak in December but improved to parity with diesel.Weak prices continued to incentivize refiners to focus on maximizing diesel production.Base oils output accounted for less than 2.65pc of South Korean refiners’ total oil products production in December. The share remained well below typical levels of more than 3pc of output in second-half 2021.The share still improved from less than 2.56pc of output during the previous five months.The slight rise in base oils run-rates coincided with a 3pc increase in refiners’ total oil products output in December from the previous month.Base oils output rose in response to the highest since May 2022..S Korea’s Dec base oils exports fall
South Korea’s base oils output rose in December to a seven-month high while domestic demand slowed.The trend raised the prospect of a rise in base oils exports at the start of this year.Any such increase in supply would be timely.Demand in the Asia-Pacific region remained weak in the first few weeks of this year.But a seasonal rise in lube consumption later in the first quarter raised the prospect of a pick-up in base oils requirements.The delayed buying and a revival in Chinese demand was likely to add to the subsequent rise in demand.South Korea’s base oils output of 2.80mn bl (394,000t) in December rose by 6pc from the previous month, according to Korea Petroleum Association (KPA)..Output fell from year-earlier levels for a seventh month. But the 1pc fall in production was the smallest contraction since last May.The sustained slowdown cut output to 16.14mn bl in the second half of last year. The volume was down 13pc from 18.57mn bl during the same period in 2021.The drop in output cut the supply overhang in the Asia-Pacific region, especially during the fourth quarter of the year.Surplus supply during the year had kept sustained pressure on regional base oils prices. These fell to a discount to diesel prices for three months to the beginning of December.Prices remained weak in December but improved to parity with diesel.Weak prices continued to incentivize refiners to focus on maximizing diesel production.Base oils output accounted for less than 2.65pc of South Korean refiners’ total oil products production in December. The share remained well below typical levels of more than 3pc of output in second-half 2021.The share still improved from less than 2.56pc of output during the previous five months.The slight rise in base oils run-rates coincided with a 3pc increase in refiners’ total oil products output in December from the previous month.Base oils output rose in response to the highest since May 2022..S Korea’s Dec base oils exports fall
