Thailand’s base oils output fell to a three-month low in September, adding to a drop in Asia’s base oils supply to its lowest since the start of the year.Thailand’s lower Group I base oils output coincided with Japan’s unusually low base oils production and preceded the permanent closure of a key Group I base oils unit in China in October.The persistently tighter supply of Group I base oils in the Asia-Pacific region increasingly incentivized blenders to minimize their consumption of the product in their lubricants formulations.Thailand’s base oils output of 54,700 kilolitres (48,500 tonnes) in September fell from 58,500 kilolitres the previous month, government data showed.Output was up 8% and for a third month in September from year-earlier levels.The rise in output from year-earlier levels followed a drop in production during the previous seven months to June and boosted third-quarter output to 175,000 kilolitres.The quarterly volume rose by 12% from the previous three months to the highest level since first-half 2022.Thailand’s base oils output typically falls during the third quarter from the previous three months, at a time of year when demand faces a seasonal slowdown.The higher production levels this time coincided with increasingly tighter supply of Group I base oils in the Asia-Pacific region.The tighter supply supported regional Group I base oils prices that stayed higher than usual relative to feedstock and gasoil prices during the third quarter of the year.The firmer margins, especially for heavier grades, incentivized Group I producers like Thailand to increase production.The persistent supply-tightness in Asia highlighted the limited impact of the pick-up in Thailand’s base oils output.The tight availability instead supported a rise in Group I base oils shipments from Europe and Saudi Arabia to southeast Asia during the second half of the year.The need for additional Group I supplies from more distant markets contrasted with Asia’s more plentiful availability of premium-grade base oils.The contrasting supply dynamics added to the incentive for regional blenders to maximise their use of premium-grade base oils instead..Japan’s Sept base oils supply stays low.S Korea’s Sept base oils output falls.Taiwan’s Sept base oils exports fall
Thailand’s base oils output fell to a three-month low in September, adding to a drop in Asia’s base oils supply to its lowest since the start of the year.Thailand’s lower Group I base oils output coincided with Japan’s unusually low base oils production and preceded the permanent closure of a key Group I base oils unit in China in October.The persistently tighter supply of Group I base oils in the Asia-Pacific region increasingly incentivized blenders to minimize their consumption of the product in their lubricants formulations.Thailand’s base oils output of 54,700 kilolitres (48,500 tonnes) in September fell from 58,500 kilolitres the previous month, government data showed.Output was up 8% and for a third month in September from year-earlier levels.The rise in output from year-earlier levels followed a drop in production during the previous seven months to June and boosted third-quarter output to 175,000 kilolitres.The quarterly volume rose by 12% from the previous three months to the highest level since first-half 2022.Thailand’s base oils output typically falls during the third quarter from the previous three months, at a time of year when demand faces a seasonal slowdown.The higher production levels this time coincided with increasingly tighter supply of Group I base oils in the Asia-Pacific region.The tighter supply supported regional Group I base oils prices that stayed higher than usual relative to feedstock and gasoil prices during the third quarter of the year.The firmer margins, especially for heavier grades, incentivized Group I producers like Thailand to increase production.The persistent supply-tightness in Asia highlighted the limited impact of the pick-up in Thailand’s base oils output.The tight availability instead supported a rise in Group I base oils shipments from Europe and Saudi Arabia to southeast Asia during the second half of the year.The need for additional Group I supplies from more distant markets contrasted with Asia’s more plentiful availability of premium-grade base oils.The contrasting supply dynamics added to the incentive for regional blenders to maximise their use of premium-grade base oils instead..Japan’s Sept base oils supply stays low.S Korea’s Sept base oils output falls.Taiwan’s Sept base oils exports fall
