· Global base oils prices extend fall vs diesel, contrasting with firmer diesel values vs crude.· Falling base oils premium to diesel incentivizes refiners to produce supplies to cover term commitments, reduces incentive to produce surplus volumes for export market.· Europe’s Group I base oils price premium to diesel falls to three-month low, still up more than $250/t since 2H Jan 2023..· Europe’s Group II base oils price premium to diesel falls close to three-month low; size of fall smaller than for Group I base oils.· Asia’s Group I/II base oils price premium to diesel falls to four-month low..· Asia’s Group I/II premium to diesel still up more than $150/t since 2H Jan 2023; returns to levels that discourage refiners from supplying additional volumes.· India’s retail diesel premium to Asia Group II light-grade base oil prices rises to highest since 1H 2022.· China’s domestic Group II light-grade price premium to Shandong diesel steadies close to five-month low, remains well above typical levels..· Relatively firm domestic light-grade price premium incentivizes refiners to maintain or increase output.· US domestic base oils price premium to heating oil stays at lowest since start of year..Global base oils – week of July 3: Demand outlook
· Global base oils prices extend fall vs diesel, contrasting with firmer diesel values vs crude.· Falling base oils premium to diesel incentivizes refiners to produce supplies to cover term commitments, reduces incentive to produce surplus volumes for export market.· Europe’s Group I base oils price premium to diesel falls to three-month low, still up more than $250/t since 2H Jan 2023..· Europe’s Group II base oils price premium to diesel falls close to three-month low; size of fall smaller than for Group I base oils.· Asia’s Group I/II base oils price premium to diesel falls to four-month low..· Asia’s Group I/II premium to diesel still up more than $150/t since 2H Jan 2023; returns to levels that discourage refiners from supplying additional volumes.· India’s retail diesel premium to Asia Group II light-grade base oil prices rises to highest since 1H 2022.· China’s domestic Group II light-grade price premium to Shandong diesel steadies close to five-month low, remains well above typical levels..· Relatively firm domestic light-grade price premium incentivizes refiners to maintain or increase output.· US domestic base oils price premium to heating oil stays at lowest since start of year..Global base oils – week of July 3: Demand outlook