· Asia’s base oils demand could start to improve in the coming month as buyers start to eye shipments for delivery in final weeks of Q3 2024.· Asia’s lube demand faces seasonal slowdown in coming weeks.· Recent slowdown in base oils demand partly reflects expected slowdown in lube demand..· China’s domestic Group II price premium to FOB Asia prices continues to trend higher, climbing to highest this year.· Firmer premium facilitates arbitrage flows, coincides with domestic Group II plant maintenance work, cutting domestic supply.· Firmer premium coincides with rebound in Singapore’s China-bound base oils exports over past four weeks to highest in more than a month..· China’s supply could get additional boost if premium of domestic Group II base oils prices for imported supplies over prices for domestic prices extends recent fall..· Ongoing fall in premium follows slump in Taiwan’s base oils exports to China in June 2024.· High premium had compounded impact of China’s removal of tariff concession on supplies from Taiwan.· Any extension of fall in premium would make supplies from Taiwan more competitive, countering impact of removal of tariff concession..· Asia’s lube demand rises more than expected in May 2024 amid strong consumption in northeast Asia..· Stronger lube demand limits size of build-up of region’s surplus supplies in May 2024.· Any extension of the trend would similarly help to limit size of region’s surplus supplies heading into start of Q3 2024.· Smaller surplus would ease buyers’ concern about sharp price adjustment, supporting steadier demand..· Key markets in southeast Asia see base oils imports hold firm in May 2024 vs previous month.· Region’s growing demand and requirement for imports increase attraction/importance for Singapore and South Korea to boost their share of supplies for those markets.· Singapore’s market share of base oils imports rises in Indonesia and Thailand in first five months of the year, falls in Vietnam..· South Korea’s market share shows opposite dynamic, as well as rising share of Australia’s imports in first four months of 2024..· Other markets show different dynamic as tighter regional Group I availability boosts demand for shipments from remaining suppliers.· Philippines’ base oils imports from Thailand extend sharp surge in May for fifth month.· Surge in shipments leaves Philippines’ Group I imports from Thailand exceeding supplies from Singapore and South Korea combined for the third time in four months..· Trend highlights Thailand’s growing leverage and role as key Group I supplier..· India’s June lube demand rises for fourth month and at fastest pace this year..· India’s lube demand rose in the month of July from June in each of the previous five years.· Demand then usually fell in the month of August from July, before rebounding in month of September.· Firmer demand in months of June and July would coincide with planned plant maintenance work in India, cutting base oils supply.· Firmer demand and lower supply could speed up consumption of blenders’ base oils stocks, and trigger need for larger volumes to replenish those stocks before end of Q3 2024.· India’s June base oils imports show signs of falling from previous two months amid slowdown in shipments from South Korea and Singapore.· Drop in imports and firm domestic demand would speed up blenders’ consumption of existing stocks.· Imports likely to get less support from flows from US in July 2024, following recent wave of shipments from the country in May 2024 and June 2024..· Pakistan’s base oils imports continue to trend higher in first five months of 2024 even amid mixed recovery in country’s lube demand.· Trend reflects imports’ growing share of country’s total base oils supply and sustained rise in demand for heavy-grade base oils..· Singapore’s share of Pakistan’s imports rises sharply in Jan-May 2024, contrasting with drop in South Korea’s share of imports..· Singapore’s rising share of Pakistan’s imports precedes surge in island-state’s Group II production capacity in 2025 that will boost requirements for additional outlets..Asia’s May lube demand rises.Pakistan’s May base oils supply falls.India’s June lube demand rises.Taiwan’s June base oils exports fall
· Asia’s base oils demand could start to improve in the coming month as buyers start to eye shipments for delivery in final weeks of Q3 2024.· Asia’s lube demand faces seasonal slowdown in coming weeks.· Recent slowdown in base oils demand partly reflects expected slowdown in lube demand..· China’s domestic Group II price premium to FOB Asia prices continues to trend higher, climbing to highest this year.· Firmer premium facilitates arbitrage flows, coincides with domestic Group II plant maintenance work, cutting domestic supply.· Firmer premium coincides with rebound in Singapore’s China-bound base oils exports over past four weeks to highest in more than a month..· China’s supply could get additional boost if premium of domestic Group II base oils prices for imported supplies over prices for domestic prices extends recent fall..· Ongoing fall in premium follows slump in Taiwan’s base oils exports to China in June 2024.· High premium had compounded impact of China’s removal of tariff concession on supplies from Taiwan.· Any extension of fall in premium would make supplies from Taiwan more competitive, countering impact of removal of tariff concession..· Asia’s lube demand rises more than expected in May 2024 amid strong consumption in northeast Asia..· Stronger lube demand limits size of build-up of region’s surplus supplies in May 2024.· Any extension of the trend would similarly help to limit size of region’s surplus supplies heading into start of Q3 2024.· Smaller surplus would ease buyers’ concern about sharp price adjustment, supporting steadier demand..· Key markets in southeast Asia see base oils imports hold firm in May 2024 vs previous month.· Region’s growing demand and requirement for imports increase attraction/importance for Singapore and South Korea to boost their share of supplies for those markets.· Singapore’s market share of base oils imports rises in Indonesia and Thailand in first five months of the year, falls in Vietnam..· South Korea’s market share shows opposite dynamic, as well as rising share of Australia’s imports in first four months of 2024..· Other markets show different dynamic as tighter regional Group I availability boosts demand for shipments from remaining suppliers.· Philippines’ base oils imports from Thailand extend sharp surge in May for fifth month.· Surge in shipments leaves Philippines’ Group I imports from Thailand exceeding supplies from Singapore and South Korea combined for the third time in four months..· Trend highlights Thailand’s growing leverage and role as key Group I supplier..· India’s June lube demand rises for fourth month and at fastest pace this year..· India’s lube demand rose in the month of July from June in each of the previous five years.· Demand then usually fell in the month of August from July, before rebounding in month of September.· Firmer demand in months of June and July would coincide with planned plant maintenance work in India, cutting base oils supply.· Firmer demand and lower supply could speed up consumption of blenders’ base oils stocks, and trigger need for larger volumes to replenish those stocks before end of Q3 2024.· India’s June base oils imports show signs of falling from previous two months amid slowdown in shipments from South Korea and Singapore.· Drop in imports and firm domestic demand would speed up blenders’ consumption of existing stocks.· Imports likely to get less support from flows from US in July 2024, following recent wave of shipments from the country in May 2024 and June 2024..· Pakistan’s base oils imports continue to trend higher in first five months of 2024 even amid mixed recovery in country’s lube demand.· Trend reflects imports’ growing share of country’s total base oils supply and sustained rise in demand for heavy-grade base oils..· Singapore’s share of Pakistan’s imports rises sharply in Jan-May 2024, contrasting with drop in South Korea’s share of imports..· Singapore’s rising share of Pakistan’s imports precedes surge in island-state’s Group II production capacity in 2025 that will boost requirements for additional outlets..Asia’s May lube demand rises.Pakistan’s May base oils supply falls.India’s June lube demand rises.Taiwan’s June base oils exports fall