· Global base oils values hold firm or rise versus feedstock/competing fuel prices.· Margins hold firmer earlier than usual for time of year, pointing to more balanced supply-demand fundamentals ahead of seasonal pick-up in consumption..· FOB Asia base oils price premium to Singapore gasoil price stays higher than usual, incentivizing refiners to raise output levels.· Persistence of firm premium points to still-tighter supply-demand fundamentals even with incentive to raise output.· FOB Asia Group I SN 500/brightstock price premium to Singapore gasoil stays higher than usual, more than cushioning impact of lower SN 150 price differential..· Asia’s shrinking Group I production capacity, and wave of plant maintenance in Jan-July 2025, complicate refiners’ ability to raise output in response..· China’s domestic Group II N150 price premium to Shandong diesel prices extends fall..· Excluding sharp drop in early Jan-2025 because of surge in crude price, domestic N150 premium falls to lowest since end-2023.· Premium extends fall at a time of year when it typically peaks for the year.· Falling premium points to weaker-than-usual fundamentals for the time of year..· CFR India Group II N70 premium to Singapore gasoil price extends recovery to highest since early-Dec 2024..· Recovery pushes N70 premium back into its narrow, firm range throughout 2024.· Firmer premium makes more feasible the arbitrage to move very light grades to India.· Sustained recovery in premium points to firm buying interest for such supplies..· Europe’s Group I export base oil price premium to VGO extends recovery after bottoming out in mid-Jan 2025..· Unusually firm premium for time of year adds to signs of smaller-than-usual surplus for time of year.· Unusually firm premium incentivizes refiners to produce additional supplies for export market..· US domestic Group II N100/120 and Group III 4cSt premium to VGO hold steady for more than a month..· Group II premium steadies at similar level to its lowest level in Q1 2024.· Group III 4cSt premium steadies close to lowest level since early 2020. · Low Group II/III premiums contrast with recent recovery in heating oil premium to crude, boosting incentive for refiners to prioritise maximising distillates output.· Lower yield of Group III production compared with Group II compounds impact of weak margin, adding to incentive to produce more distillates..Asia base oils demand outlook: Week of 24 Feb.Asia base oils supply outlook: Week of 24 Feb
· Global base oils values hold firm or rise versus feedstock/competing fuel prices.· Margins hold firmer earlier than usual for time of year, pointing to more balanced supply-demand fundamentals ahead of seasonal pick-up in consumption..· FOB Asia base oils price premium to Singapore gasoil price stays higher than usual, incentivizing refiners to raise output levels.· Persistence of firm premium points to still-tighter supply-demand fundamentals even with incentive to raise output.· FOB Asia Group I SN 500/brightstock price premium to Singapore gasoil stays higher than usual, more than cushioning impact of lower SN 150 price differential..· Asia’s shrinking Group I production capacity, and wave of plant maintenance in Jan-July 2025, complicate refiners’ ability to raise output in response..· China’s domestic Group II N150 price premium to Shandong diesel prices extends fall..· Excluding sharp drop in early Jan-2025 because of surge in crude price, domestic N150 premium falls to lowest since end-2023.· Premium extends fall at a time of year when it typically peaks for the year.· Falling premium points to weaker-than-usual fundamentals for the time of year..· CFR India Group II N70 premium to Singapore gasoil price extends recovery to highest since early-Dec 2024..· Recovery pushes N70 premium back into its narrow, firm range throughout 2024.· Firmer premium makes more feasible the arbitrage to move very light grades to India.· Sustained recovery in premium points to firm buying interest for such supplies..· Europe’s Group I export base oil price premium to VGO extends recovery after bottoming out in mid-Jan 2025..· Unusually firm premium for time of year adds to signs of smaller-than-usual surplus for time of year.· Unusually firm premium incentivizes refiners to produce additional supplies for export market..· US domestic Group II N100/120 and Group III 4cSt premium to VGO hold steady for more than a month..· Group II premium steadies at similar level to its lowest level in Q1 2024.· Group III 4cSt premium steadies close to lowest level since early 2020. · Low Group II/III premiums contrast with recent recovery in heating oil premium to crude, boosting incentive for refiners to prioritise maximising distillates output.· Lower yield of Group III production compared with Group II compounds impact of weak margin, adding to incentive to produce more distillates..Asia base oils demand outlook: Week of 24 Feb.Asia base oils supply outlook: Week of 24 Feb
