· Asia’s base oils price premium to feedstock/competing fuel prices holds at firm levels, especially for heavy grades.· Firm base oils margins incentivize refiners to maintain or raise output even with seasonal slowdown in demand and prospect of improvement in supply.· Such a move could increase size of any mismatch between supply and demand.· Arbitrage to move supplies from Asia to more distant regions like US and Europe gets harder to work.· Arbitrage to move supplies from other regions like US to markets like India turn increasingly feasible.· US Group II export price discount to CFR India price deepens to widest level since May 2024..· Wider discount boosts feasibility of pick-up in arbitrage shipments from US to India..· Asia’s base oils supply should get further boost over coming weeks following completion of plant maintenance work in South Korea at end-Oct 2024.· Higher output in South Korea should support firm base oils exports in Nov 2024, after exports already rebound in Oct 2024..· Rebound in South Korea’s exports in Oct 2024 suggests market impact of plant maintenance work peaked in Sept 2024, even as shutdown mostly took place in Oct 2024.· South Korea’s exports slumped to lowest in more than a decade in Sept 2024 amid signs of stock-building ahead of shutdown.· Earlier-than-expected rebound in supplies from South Korea in Q4 2024 would coincide with seasonal slowdown in regional demand..· Base oils exports from South Korea, Taiwan and Singapore to China show signs of rising in Oct 2024 from previous month..· Those markets typically account for more than 70% of China’s monthly base oils imports.· Rise in shipments points to pick-up in China’s imports in Oct 2024.· Such a move would add to surge in China’s domestic output, triggering large rise in supply in Oct 2024.· Higher supply and seasonal slowdown in demand could boost incentive for China’s refiners to adjust output to limit large supply-build and to ease any pressure on prices..· Singapore’s base oils exports show signs of holding steadier in narrower range in recent weeks..· Shipments hold at relatively lower levels to key outlets of southeast Asia, China and India..· Any extension of that trend could partially counter impact of expected revival in South Korea’s base oils output in Nov 2024 and firm export volumes from the country.· Singapore’s four-week base oils imports fall to lowest level in more than five months..· Slowdown in shipments could further crimp speed of expected pick-up in Asia’s base oils supply..· Taiwan’s exports in Nov 2024 get boost from shipments delayed from Oct 2024.· Besides delayed shipments, volume of new cargoes for loading in Nov 2024 stays relatively low so far this month.· Taiwan’s base oils exports to southeast Asia rebound in Oct 2024..· Rise in shipments to markets like Indonesia, Philippines and Pakistan add to competition for market share in all those outlets.· Singapore and South Korea are the largest sources of overseas premium-grade supplies in most of those markets.· Competition for market share likely to intensify as new production capacity comes on line in Singapore and India in coming year.· Large cargo from Saudi Arabia set to reach Pakistan in coming week.· Pakistan’s imports from Saudi Arabia slumped during last two years.· Any pick-up in shipments from Saudi Arabia to Pakistan would boost country’s supply, add to growing competition for larger share of country's imports..S Korea’s October base oils exports rise.Taiwan’s October base oils exports rise.Asia base oils demand outlook: Week of 18 Nov.Asia base oils supply outlook: Week of 11 Nov
· Asia’s base oils price premium to feedstock/competing fuel prices holds at firm levels, especially for heavy grades.· Firm base oils margins incentivize refiners to maintain or raise output even with seasonal slowdown in demand and prospect of improvement in supply.· Such a move could increase size of any mismatch between supply and demand.· Arbitrage to move supplies from Asia to more distant regions like US and Europe gets harder to work.· Arbitrage to move supplies from other regions like US to markets like India turn increasingly feasible.· US Group II export price discount to CFR India price deepens to widest level since May 2024..· Wider discount boosts feasibility of pick-up in arbitrage shipments from US to India..· Asia’s base oils supply should get further boost over coming weeks following completion of plant maintenance work in South Korea at end-Oct 2024.· Higher output in South Korea should support firm base oils exports in Nov 2024, after exports already rebound in Oct 2024..· Rebound in South Korea’s exports in Oct 2024 suggests market impact of plant maintenance work peaked in Sept 2024, even as shutdown mostly took place in Oct 2024.· South Korea’s exports slumped to lowest in more than a decade in Sept 2024 amid signs of stock-building ahead of shutdown.· Earlier-than-expected rebound in supplies from South Korea in Q4 2024 would coincide with seasonal slowdown in regional demand..· Base oils exports from South Korea, Taiwan and Singapore to China show signs of rising in Oct 2024 from previous month..· Those markets typically account for more than 70% of China’s monthly base oils imports.· Rise in shipments points to pick-up in China’s imports in Oct 2024.· Such a move would add to surge in China’s domestic output, triggering large rise in supply in Oct 2024.· Higher supply and seasonal slowdown in demand could boost incentive for China’s refiners to adjust output to limit large supply-build and to ease any pressure on prices..· Singapore’s base oils exports show signs of holding steadier in narrower range in recent weeks..· Shipments hold at relatively lower levels to key outlets of southeast Asia, China and India..· Any extension of that trend could partially counter impact of expected revival in South Korea’s base oils output in Nov 2024 and firm export volumes from the country.· Singapore’s four-week base oils imports fall to lowest level in more than five months..· Slowdown in shipments could further crimp speed of expected pick-up in Asia’s base oils supply..· Taiwan’s exports in Nov 2024 get boost from shipments delayed from Oct 2024.· Besides delayed shipments, volume of new cargoes for loading in Nov 2024 stays relatively low so far this month.· Taiwan’s base oils exports to southeast Asia rebound in Oct 2024..· Rise in shipments to markets like Indonesia, Philippines and Pakistan add to competition for market share in all those outlets.· Singapore and South Korea are the largest sources of overseas premium-grade supplies in most of those markets.· Competition for market share likely to intensify as new production capacity comes on line in Singapore and India in coming year.· Large cargo from Saudi Arabia set to reach Pakistan in coming week.· Pakistan’s imports from Saudi Arabia slumped during last two years.· Any pick-up in shipments from Saudi Arabia to Pakistan would boost country’s supply, add to growing competition for larger share of country's imports..S Korea’s October base oils exports rise.Taiwan’s October base oils exports rise.Asia base oils demand outlook: Week of 18 Nov.Asia base oils supply outlook: Week of 11 Nov
