· Europe’s Group I base oils export prices rise sharply since early March 2024.· Export prices rise faster than Europe’s domestic prices and faster than prices in other regions.· Prices rise because of tighter availability of surplus Group I base oils supply for export.· Europe’s higher prices and prospect of supply staying tighter incentivize buyers in overseas markets to line up alternative shipments from other regions.· Unusual flow of shipments from suppliers like US and China to outlets like Africa point to initial signs of such a structural change in trade flows.· Europe’s Group I base oils exports prices surge relative to domestic prices; brightstock flips to steep premium to domestic prices..· Export prices rebound as closure of Group I plant in Italy adds to increasingly tight regional supply of Group I base oils..· Europe’s rebounding export prices and tight supply curb arbitrage opportunities to overseas markets.· Europe’s export price for Group I SN 500 flips back to widening premium to CFR India SN 500 prices, from a steep discount in Q1 2024..· Widening premium and tighter supply boosts attraction for Indian buyers to line up Group I supplies from other sources like Russia.· India’s base oils imports from Russia duly surge in Q1 2024..· Europe’s rebounding export prices and tight supply facilitate arbitrage opportunities from other regions.· Premium of Europe Group I SN 500 export price over US Group II heavy-grade export price holds close to highest since mid-2022 even after recent recovery in US export prices..· Europe’s Group I brightstock export price flips to premium to US bright stock price in recent weeks for the first time since 2022, from discount of more than $300/tonne in Q1 2024..· Europe’s widening Group I base oils premium to US Group I and Group II prices boosts attraction for buyers in markets like Africa to secure supplies from other sources instead, like US, China and Saudi Arabia.· US’ February base oils exports include largest cargo to Kenya in more than eight years.· US’ March base oils exports include second unusually large cargo to Morocco in five months..· US exports to Morocco totalled less than 500 tonnes in the eight years before Nov 2023. · Europe is typically the largest supplier for markets like Morocco, Egypt and Kenya..· China’s March base oils exports include shipment to Egypt for first time in at least seven years..· Unusual trade flows likely to become more regular as shipments cover for the fall in Europe’s structural base oils supply.· Changing trade flows in turn provide valuable opportunity for refiners in other markets to develop new outlets in a structurally oversupplied global market..Global base oils margins outlook: Week of 13 May.Asia base oils demand outlook: Week of 13 May.Asia base oils supply outlook: Week of 13 May
· Europe’s Group I base oils export prices rise sharply since early March 2024.· Export prices rise faster than Europe’s domestic prices and faster than prices in other regions.· Prices rise because of tighter availability of surplus Group I base oils supply for export.· Europe’s higher prices and prospect of supply staying tighter incentivize buyers in overseas markets to line up alternative shipments from other regions.· Unusual flow of shipments from suppliers like US and China to outlets like Africa point to initial signs of such a structural change in trade flows.· Europe’s Group I base oils exports prices surge relative to domestic prices; brightstock flips to steep premium to domestic prices..· Export prices rebound as closure of Group I plant in Italy adds to increasingly tight regional supply of Group I base oils..· Europe’s rebounding export prices and tight supply curb arbitrage opportunities to overseas markets.· Europe’s export price for Group I SN 500 flips back to widening premium to CFR India SN 500 prices, from a steep discount in Q1 2024..· Widening premium and tighter supply boosts attraction for Indian buyers to line up Group I supplies from other sources like Russia.· India’s base oils imports from Russia duly surge in Q1 2024..· Europe’s rebounding export prices and tight supply facilitate arbitrage opportunities from other regions.· Premium of Europe Group I SN 500 export price over US Group II heavy-grade export price holds close to highest since mid-2022 even after recent recovery in US export prices..· Europe’s Group I brightstock export price flips to premium to US bright stock price in recent weeks for the first time since 2022, from discount of more than $300/tonne in Q1 2024..· Europe’s widening Group I base oils premium to US Group I and Group II prices boosts attraction for buyers in markets like Africa to secure supplies from other sources instead, like US, China and Saudi Arabia.· US’ February base oils exports include largest cargo to Kenya in more than eight years.· US’ March base oils exports include second unusually large cargo to Morocco in five months..· US exports to Morocco totalled less than 500 tonnes in the eight years before Nov 2023. · Europe is typically the largest supplier for markets like Morocco, Egypt and Kenya..· China’s March base oils exports include shipment to Egypt for first time in at least seven years..· Unusual trade flows likely to become more regular as shipments cover for the fall in Europe’s structural base oils supply.· Changing trade flows in turn provide valuable opportunity for refiners in other markets to develop new outlets in a structurally oversupplied global market..Global base oils margins outlook: Week of 13 May.Asia base oils demand outlook: Week of 13 May.Asia base oils supply outlook: Week of 13 May