· Europe Group II price premium to Group I prices continues to trend higher, slowly..· Group II premium remains much lower than before February 2023.· Widening Group II premium points to more balanced fundamentals – but also raises risk of dampening pace of recovery in Group II demand.· Europe Group III premium to Group I eases from March levels – coinciding with signs of improving supply.· Group III premium could widen again in coming weeks ahead of and during planned plant maintenance work in Spain.· Persistently wide Group III premium to Group II in most markets incentivizes blenders to switch to alternative feedstock instead of Group III.· Persistently wide Group III premium suggests blenders have limited room to use alternatives in place of Group III.· US Group II heavy-grade premium to light grades stays unusually wide, and much wider than equivalent heavy-light price spread in Europe and Asia.· Asia Group II heavy-grade premium to light grades stays unusually narrow – at less than $100t.· Narrow heavy-grade premium reflects regional surplus and need to move regular supplies to other markets like Americas and Mideast Gulf.· Asia Group II light-grade premium to Group I base oils stays at widest in more than six months.· Wide Asia Group II premium partly reflects pressure on Group I prices from ongoing flow of Chinese Group I light-grade supplies to markets like India at unusually competitive prices.· Asia Group I heavy-neutrals premium to light grades holds at widest in more than six months.· Wide premium partly reflects weakness of Group I light grades.· Further rise in Group I heavy-grade premium faces pressure from its narrow discount to Group II heavy grades.· Asia Group III prices maintain wide premium to Group I/II prices. Like other regions, high premium suggests buyers have limited alternative options instead of Group III..Americas/EMEA base oils - week of April 17: Supply outlook
· Europe Group II price premium to Group I prices continues to trend higher, slowly..· Group II premium remains much lower than before February 2023.· Widening Group II premium points to more balanced fundamentals – but also raises risk of dampening pace of recovery in Group II demand.· Europe Group III premium to Group I eases from March levels – coinciding with signs of improving supply.· Group III premium could widen again in coming weeks ahead of and during planned plant maintenance work in Spain.· Persistently wide Group III premium to Group II in most markets incentivizes blenders to switch to alternative feedstock instead of Group III.· Persistently wide Group III premium suggests blenders have limited room to use alternatives in place of Group III.· US Group II heavy-grade premium to light grades stays unusually wide, and much wider than equivalent heavy-light price spread in Europe and Asia.· Asia Group II heavy-grade premium to light grades stays unusually narrow – at less than $100t.· Narrow heavy-grade premium reflects regional surplus and need to move regular supplies to other markets like Americas and Mideast Gulf.· Asia Group II light-grade premium to Group I base oils stays at widest in more than six months.· Wide Asia Group II premium partly reflects pressure on Group I prices from ongoing flow of Chinese Group I light-grade supplies to markets like India at unusually competitive prices.· Asia Group I heavy-neutrals premium to light grades holds at widest in more than six months.· Wide premium partly reflects weakness of Group I light grades.· Further rise in Group I heavy-grade premium faces pressure from its narrow discount to Group II heavy grades.· Asia Group III prices maintain wide premium to Group I/II prices. Like other regions, high premium suggests buyers have limited alternative options instead of Group III..Americas/EMEA base oils - week of April 17: Supply outlook
