India’s lube demand rose in August, curbing the size of any pick-up in blenders’ stocks at a time of year when monsoon rains typically trigger a slowdown in consumption.Lube demand of 365,000 tonnes in August edged up from 362,000 tonnes in July and rose by 7% from year-earlier levels, government data showed..Firmer demand coincided with a sharp slowdown in base oils shipments from Asia to India in July.Any subsequent fall in India’s base oils imports in August would compound the pressure on blenders’ inventories.Lower-than-expected inventories could trigger a larger pick-up in demand for replenishment base oils supplies ahead of a typical rise in lube demand during the upcoming festival season..The planned reduction in India’s consumption tax in second-half September could add to the pick-up in demand, with the lower tax expected to boost automobile sales.“Dealers remain confident that September will herald the beginning of an accelerated growth cycle, powered by both policy tailwinds and festive fervour," Federation of Automobile Dealers Association (FADA) President C S Vigneshwar said in a statement.India’s automobile sales rose by 3% in August and for the fourth time in five months from year-earlier levels even as some buyers postponed purchases until after the lower tax rates come into effect.India’s firm imported base oils cargo prices pointed to signs of ongoing requirements for additional supplies from overseas markets.The premium of imported Group II heavy-grade base oil cargo prices over FOB Asia and FOB US prices remained wide in September and throughout the third quarter of the year.The wide price-premium facilitated the line-up of more arbitrage shipments to move to India even after the completion of a protracted round of base oil plant-maintenance in the country..India’s July base oils supply outpaces demand.India’s July lube demand rises.Base Oil News stories and analysis also available on ICIS platform
