Indonesia’s June base oil imports rise

Indonesia’s base oils imports rose in June for the ninth time in ten months as strong economic growth boosts lube consumption.

Base oils imports of 40,390t in June rose from 32,720t the previous month and by 17pc from year-earlier levels, government data showed.

Imports of 240,510t in the first half of the year were up 29pc from 185,760t during the same period last year.

Southeast Asian markets like Indonesia and Vietnam have seen a strong rise in base oils imports this year on the back of rebounding economic growth.

The sustained rise in shipments contrasted with slowing base oils requirements in China, where lockdowns have cut the country's economic growth.

The rise in shipments to southeast Asia has been insufficient to balance out the slowdown in China’s import requirements.

The subsequent surplus availability has kept regional base oils prices under pressure.

But the sustained rise in economic growth and the structural shortage of base oils in markets like Indonesia and Vietnam make them increasingly attractive markets for Asia-Pacific producers.

Indonesia has no Group II base oils production capacity. Vietnam has no base oils production capacity.

Indonesia’s economy grew by more than 5pc in the second quarter of the year.

The country's automobile sales have risen for most of the past 16 months. Its purchasing managers’ index rose in July to a three-month high.

Base oils imports from Singapore recovered in June to a three-month high of more than 22,440t.

Shipments from South Korea recovered to 13,590t in June, from less than 10,800t the previous month.

Imports from the two countries accounted for almost 90pc of Indonesia’s total base oil shipments in June.