·        Americas’ base oils demand could be more mixed as competitive US export prices cushion impact of likely slowdown in regional requirements.

·        Domestic US demand could remain more muted as steep US export price discount to domestic prices points to sufficient surplus supply, raising expectations of downward pressure on domestic prices.

·        Expectations of sufficient supply, steady-to-lower prices curb any urgency to replenish stocks.

·        US posted price premium to domestic spot prices stays wider than usual, ICIS data shows.

·        Wide premium raises expectations of rise in spot prices or fall in posted prices.

·        Weaker fundamentals at start of year make fall in posted prices more likely than rise in spot prices, adding to buyers’ incentive to hold back.

·        Demand in Latin America for heavy-grade base oils from Asia could see slowdown as Asia price discount to US Group II export prices narrows sharply.

·        Trend boosts attraction of US supplies instead.

·        US’ October base oils/lube demand outpaces supply for fifth time in six months as sustained rise in exports counters weak domestic demand.

·        Trend reflects US refiners’ increased focus on export markets to maintain supply-demand balance.

·        Strong overseas demand in turn reflects benefit of competitive US export base oils prices, especially compared with prices in 2022.

·        Trend highlights importance of maintaining competitive prices to sustain firm overseas demand and to avoid a major supply-build at end-2023/early 2024.

·        Argentina’s November lube demand falls for fourth time in five months.

·        Lube consumption likely to extend slowdown over coming months in face of even slower economic growth.

·        Slowdown would coincide with fall in Mexico’s demand for base oils from overseas markets and likely drop in Brazil’s demand for base oils imports following completion of plant maintenance work.

·        Synchronised slowdown in demand in Latin Americas’s largest markets would complicate any moves by US refiners to move more surplus base oils supplies to the region.   

·        Europe’s base oils demand faces pressure from buyers’ typical caution at start of new year.

·        Demand could get support earlier than usual amid signs of more balanced fundamentals than same time a year ago.

·        Europe’s October lube demand rises for first time in fourteen months.

·        Demand rises on shrinking pace of slowdown in Germany and France, combined with firm consumption in Mediterranean market.

·        Steadier demand in Europe would contrast with end-2022 and curb prospect of significant build-up of surplus base oils supplies at year-end.

·        Italy’s November lube demand rises for sixth month.

·        Sustained recovery in lube demand in Mediterranean region cuts blenders’ feedstock inventories.

·        Blenders’ moves to maintain lower feedstock inventories likely to trigger faster moves to replenish stocks in response to recovery in lube demand.

·        Blenders and refiners had previously adapted to slowdown in lube demand.

·        Firmer consumption in Italy highlights ongoing disparity between state of lube demand in Mediterranean region and in northern European markets like Germany.

·        Germany’s October lube demand falls for twenty-eighth month.

·        Prolonged fall in demand sustains blenders’ incentive to maintain lower stocks.

·        Germany’s October lube demand lags consumption in Spain and Italy combined by the largest amount in more than eight years.

·        Trend incentivizes refiners and blenders to target south Europe with more supplies.

·        Arbitrage to move Group I cargoes from Asia to Mideast Gulf gets harder to work, adding to closed arb from Europe, ICIS data shows.

·        Trend raises prospect of Mideast Gulf buyers seeking Group I supplies from alternative sources or switching to consume more Group II base oils.