Vietnam’s June base oil imports rise

Vietnam’s base oils imports rose in June to a three-month high amid strong demand and a revival in supplies from several key sources.

Base oil imports of 23,920t in June rose from a seven-month low of 14,330t in May, provisional customs data showed.

Imports rose from year-earlier levels for the first time in three months.

Vietnam’s base oil imports had dipped in April and May amid a slowdown in shipments from South Korea, Singapore and Thailand.

The slowdown reflected more a drop in supplies rather than weaker demand.

Vietnam’s economy grew strongly in the first three months of the year and likely grew at an even faster pace in the second quarter.

The country’s automobile sales rose in June for a sixth month. Industrial production rose in June at its fastest pace in more than a year.

Manufacturing activity likely got a boost from lockdowns in China that incentivized a shift of production to countries like Vietnam.

Strong demand coincided with a drop in base oils exports from several key suppliers during the second quarter of the year.

A drop in base oils exports from Singapore in May likely reflected plant run cuts or maintenance work.

Lower exports from South Korea during the second quarter of the year coincided with plant maintenance work.

Vietnam’s strong demand is likely to attract growing interest from regional refiners as they target alternative markets to counter the sustained slowdown in buying interest in China.

Singapore has typically been Vietnam’s largest source of base oil supplies. But South Korea accounted for a larger volume in June for the third time this year.

Imports from the two countries combined have accounted for more than 80pc of Vietnam’s supplies every month so far this year.