Singapore’s Sept base oils exports fall

Singapore’s base oils exports fell in September to a four-month low amid a drop in shipments from domestic sources.

Base oils exports of 155,030t in September fell from 165,370t in August and by 19pc from year-earlier levels, government data showed.

The slowdown left the city-state’s total shipments of 1.49mn t in the first nine months of the year just 8pc higher than year-earlier levels of 1.37mn t.

The size of the increase slowed from a 10pc rise in exports in the first half of the year.

The volume was still down 7pc from 1.60mn t during the same period in 2020 and well below more typical levels of more than 2mn t during the years before then.

Singapore’s base oils exports partially recovered in the third quarter of last year. The move helped to ease extreme supply tightness in the Asia-Pacific region during the first half of 2021.

The fall in base oils exports in September this year helped to avoid adding to a large supply overhang in the Asia-Pacific region.

The surplus grew during the third quarter as a seasonal slowdown in demand in markets like India and Thailand compounded a sustained drop in lube consumption in China.

Falling Asia-Pacific base oils prices throughout the third quarter added to the drop in demand. They also cut already-low base oils margins and incentivized regional refiners to cut run rates. Some did.

Singapore’s base oils exports from domestic sources slipped in September to their lowest since May, when some partial plant maintenance work took place.

Lower prices also kept shut the arbitrage to Asia and encouraged refiners in other markets to move shipments to other outlets instead rather than to markets like Singapore.

The trend cut the volume of supplies available for shipment from Singapore on to other markets in the region.

The city-state’s base oils re-exports fell below 25,000t in September to a 10-month low.