Brazil’s base oils output fell in February to a 16-month low in the face of sliding domestic demand and surging motor fuel prices.
Base oils output of 44,040m³ (39,010t) in February fell from 49,410m³ the previous month and by 25pc from year-earlier levels, government data showed.
The volume was the lowest since October 2020.
A strong rebound in domestic and overseas demand at that time had left global base oils supply unusually tight and triggered a surge in prices.
The recovery in domestic lube demand began to peter out from the middle of last year. The trend coincided with a pick-up in Brazil’s base oil exports during the second half of last year.
Availability of surplus supplies in other regions also began to improve around the same time.
Base oils output from Petrobras’s 575,000 t/yr Group I unit at its Reduc refinery fell back to 39,420m³ in February.
Production at the unit had hovered just above the 42,000m³ level for the previous three months and averaged more than 52,000 m³/month in 2021.
There was no production for a third month at Petrobras’s 90,000 t/yr unit at its Rlam refinery.
The unit had produced base oils for six straight months to November. Before May 2021, it had not produced any base oils for more than a year.
