India’s imports of Group I heavy-neutrals fell to an eighteen-month low in June amid a slump in shipments from the Middle East.Total imports of around 5,000 tonnes of Group I heavy-neutrals in June fell from close to 10,000 tonnes the previous month, provisional customs data showed. .The May volume was already down from typical imports of close to 20,000 tonnes/month in the four months to April and coincided with plant-maintenance work in Iran.The lower volumes in May left India’s buyers with squeezed inventories.The drop in shipments in June compounded the supply-tightness.The drop in shipments highlighted ongoing repercussions of the Israel-Iran conflict in June even after the cessation of hostilities.One repercussion of the tighter supply was a jump in India’s imported Group I SN 500 cargo price relative to other grades and other regions.The price-premium of CFR India SN 500 over the FOB Asia cargo price widened in first-half July to the highest level in more than a year.Another repercussion of the tighter supply could be a pick-up in India’s demand for Group II base oils to cover blenders’ heavy-grade requirements.Buyers had previously sought to procure more Group I base oils because of their steep price-discount compared with Group II supplies.Any moves to procure more Group II supplies would reduce that cost-benefit.The scenario already began to materialise in May and June.Group II heavy-neutrals shipments accounted for more than 90% of India’s combined Group I and Group II heavy-grade imports in June and more than 87% in May.The share was up from 72% in the first four months of the year.Any further moves to procure more Group II base oils and hold larger stocks could also limit recent pressure on Asia’s Group II heavy-grade prices.Those prices weakened relative to light-grade base oils and Group I base oils in response to easing supply-tightness following the completion of most plant-maintenance work in Asia..India’s June base oils imports fall.S Korea's June exports to India rise.India’s June lube demand stays high
