· US base oils demand likely to get ongoing support from moves to build stocks.· Stock-building brings forward future demand, counters for now the impact of weaker end-user demand.· Round of stock-building could take longer than expected amid more limited surplus availability of supplies.· Overseas demand for US supplies could ebb in markets with alternative supply options and where prices are lower.· Demand from India and Middle East likely to fall as US prices extend premium to CFR prices in those markets.· Demand for US supplies shows signs of holding firm in South Africa and West Africa in July 2024.· Shipments to those markets likely partly reflects some term volumes and partly reflects tighter availability in Europe..· Latin America’s base oils demand for overseas supplies is likely to hold firm even as consumption continues to trend lower so far this year..· Demand falls as ongoing slide in consumption in Mexico and Argentina counters firmer demand in Brazil.· Mexico’s May lube demand falls for twelfth time in thirteen months as auto lube consumption extends slide..· Slowdown in demand lags even steeper fall in US base oils exports to Mexico and South America so far this year.· Trend leaves Latin America’s base oils supply barely covering demand in recent months..· Trend raises prospect of sustaining strong demand from Latin America for overseas base oils supplies.· Trend boosts incentive for Latin America’s buyers to eye supplies from other sources besides US.· Region’s reliance on US for most of its overseas shipments adds to that incentive to diversify its sources as hedge against supply disruptions..· Group I base oils demand in Europe could start to ease as seasonal slowdown in consumption coincides with improvement in supply.· Group I demand likely to hold firm in overseas markets for which Europe was previously a key source.· Europe’s high export prices could dampen overseas demand for the region's supplies even if availability improves.· Europe’s Group I base oils exports to markets outside the region extend slowdown in May 2024 from year-earlier levels..· Europe’s lube demand shows signs of staying more mixed through Q2 2024..· Mixed lube consumption growth in some of region’s largest markets curbs incentive for blenders to build larger inventories.· Mixed lube consumption growth leaves market facing typical seasonal dip in consumption in third quarter, especially in month of August.· Mixed lube demand in different countries leaves total consumption for the region relatively steady..· Steady total demand would facilitate base oils refiners’ supply plans for the region..Global base oils margins outlook: Week of 22 July.Global base oils arb outlook: Week of 22 July.Asia base oils demand outlook: Week of 22 July
· US base oils demand likely to get ongoing support from moves to build stocks.· Stock-building brings forward future demand, counters for now the impact of weaker end-user demand.· Round of stock-building could take longer than expected amid more limited surplus availability of supplies.· Overseas demand for US supplies could ebb in markets with alternative supply options and where prices are lower.· Demand from India and Middle East likely to fall as US prices extend premium to CFR prices in those markets.· Demand for US supplies shows signs of holding firm in South Africa and West Africa in July 2024.· Shipments to those markets likely partly reflects some term volumes and partly reflects tighter availability in Europe..· Latin America’s base oils demand for overseas supplies is likely to hold firm even as consumption continues to trend lower so far this year..· Demand falls as ongoing slide in consumption in Mexico and Argentina counters firmer demand in Brazil.· Mexico’s May lube demand falls for twelfth time in thirteen months as auto lube consumption extends slide..· Slowdown in demand lags even steeper fall in US base oils exports to Mexico and South America so far this year.· Trend leaves Latin America’s base oils supply barely covering demand in recent months..· Trend raises prospect of sustaining strong demand from Latin America for overseas base oils supplies.· Trend boosts incentive for Latin America’s buyers to eye supplies from other sources besides US.· Region’s reliance on US for most of its overseas shipments adds to that incentive to diversify its sources as hedge against supply disruptions..· Group I base oils demand in Europe could start to ease as seasonal slowdown in consumption coincides with improvement in supply.· Group I demand likely to hold firm in overseas markets for which Europe was previously a key source.· Europe’s high export prices could dampen overseas demand for the region's supplies even if availability improves.· Europe’s Group I base oils exports to markets outside the region extend slowdown in May 2024 from year-earlier levels..· Europe’s lube demand shows signs of staying more mixed through Q2 2024..· Mixed lube consumption growth in some of region’s largest markets curbs incentive for blenders to build larger inventories.· Mixed lube consumption growth leaves market facing typical seasonal dip in consumption in third quarter, especially in month of August.· Mixed lube demand in different countries leaves total consumption for the region relatively steady..· Steady total demand would facilitate base oils refiners’ supply plans for the region..Global base oils margins outlook: Week of 22 July.Global base oils arb outlook: Week of 22 July.Asia base oils demand outlook: Week of 22 July
