Indonesia’s Jan Grp I base oil exports up

Indonesia’s Group I base oil exports rose in January to a nine-month high amid signs of a pick-up in regional demand for bright stock.

Total exports of 6,230t in January rose from less than 3,000t the previous month to their highest since last April, government data showed.

Indonesia’s Group I base oil exports had slowed sharply during the second half of last year amid a pick-up in regional availability of heavy-grade supplies especially.

Sliding prices and high freight costs added to a reluctance to procure base oil cargoes from Indonesia.

The drop in base oils demand contrasted with the first half of last year, when buying interest throughout the region surged. That period had coincided with unusually tight supply from other key sources like Singapore.

Freight rates have remained high. But rising outright base oil prices have eased buyers’ concern about exposure to lower prices. Their priority has switched to securing sufficient volumes to cover their requirements.

Supply got a boost in January from a resumption of shipments from the port of Cilacap. There had been no shipments from that port during the previous six months.