Singapore June base oils exports rise

Singapore’s base oil exports recovered in June after dipping in May to a seven-month low.

Base oils exports of 179,560t in June rose from 139,320t the previous month, government data showed.

The rise in shipments boosted total exports to 998,360t in the first half of the year. The volume was up 10pc from 909,730t during the same period last year.

The higher volumes balanced out a slowdown in exports from other Asia-Pacific sources like South Korea and Taiwan.

Regional availability of base oils remained healthy even with the drop in shipments from those other sources.

Supply was also more than sufficient even with Singapore’s base oil exports still below more typical January-June levels of at least 1.60mn t in the years before 2020.

The healthy availability mostly reflected the impact of unusually weak Chinese demand so far this year.

The surplus availability curbed the rise in regional prices in first-half 2022, especially compared with other markets like Europe and the Americas.

The diverging prices created arbitrage opportunities that helped to remove some of the surplus.

The arbitrage opportunities are now more challenging amid easing tightness and lower prices in markets like Europe.

Singapore’s base oil exports had dipped to a ten-month low in May amid a slump in re-exports from domestic sources in the city-state. The slowdown likely reflected a change in refinery production during the month.

The re-export volume recovered in June to a three-month high and well above more typical levels over the past year. The volume continued to hold at firmer levels in July.