Asia’s lube demand fell in September for a third month from a year earlier, muffling the size of a seasonal pick-up in consumption at the end of the third quarter.The weaker demand coincided with and cushioned the impact of a drop in Asia’s base oils supply in September.The same dynamic of weaker demand and lower regional supply likely extended at least into the month of October.Asia’s lube consumption of more than 765,000 tonnes in September fell by 5% and for a third month from year-earlier levels, government and industry data showed.The volume excluded China.Demand fell by almost a fifth in northeast Asia and by more than 5% in southeast Asia.Consumption fell more slowly in southeast Asia as strong demand in markets like the Philippines cushioned the impact of weaker consumption in markets like Thailand.Asia’s lube consumption still rose in September from close to 740,000 tonnes in August, reflecting the seasonal pick-up in demand after a lull in activity during the summer months.But the smaller increase in consumption cushioned the impact of a drop in Asia’s base oils supply to a seven-month low in September.Supply fell because of lower output in markets like South Korea and India.Asia’s surplus of supply over demand still narrowed in September to a three-month low.But it remained higher than levels during the second quarter of the year, when strong demand kept availability tight.Asia’s base oils price-premium to gasoil prices held at more elevated levels during most of the second and third quarters of the year, pointing to balanced-to-tight supply-demand fundamentals.The premium to gasoil remained firm so far in the fourth quarter of the year but slipped from recent highs in mid-September.The lower price premium since then points to signs that the recent supply tightness could be starting to ease. .Asia lube demand likely to improve in Q1.Thailand’s September lube demand falls.Japan’s Sept base oils supply stays low
