The latest price reduction from the supplier entailed cuts of $45 to $65 per metric ton for its API Group I solvent neutral 150 and SN500/600, while its bright stock was lowered by $25/t. Group II oils experienced drops of $25/t to $45/t, with all of the reductions taking effect on Dec. 12, market sources said, although no producer confirmation was available.

Other producers, such as Formosa in Taiwan, have also joined the quest to entice buyers by marking down offer prices, but have encountered a lukewarm response at best, as buyers are concerned that base oil prices could decline further in coming weeks, given the fact that crude oil values remain volatile.

The fact that the Taiwanese producer was heard to have decreased its base oil volumes exported to China in December by more than 10 percent is another indication that demand has shrunk. The producer regularly supplies both term and spot cargoes, but a slowdown in downstream segments, coupled with consumers efforts to reduce stocks ahead of year-end, have resulted in lower requirement levels, according to sources.

It was also heard that a Russian supplier, who is typically very active in terms of Group I exports to China, cut back on volumes being shipped as a result of the lower demand, coupled with trimmed operating rates at the producers base oil unit during December.

Meanwhile, in India, business was heard to have slowed down as well, with buyers feeling confident that they can procure the cargoes they need any time as there is ample availability.

A number of December cargoes of United States origin are anticipated to reach India in late January and February, adding to the already well-supplied market scenario. U.S. Group I and II producers have decreased prices several times in the last few weeks, with the latest round yielding fairly hefty price cuts for Group II products.

The volumes moving into India from the U.S. are said to have declined because prices are not as attractive as earlier in the year, and some buyers interest has also shifted towards South Korean offers, as these cargoes have a shorter lead time, reducing some of the pricing risks associated with cargoes taking much longer to arrive.

Despite the fact that India buys significant amounts of Group I oils, most of the appetite has centered on Group II cargoes, because the price gap between these two categories has dissolved. There has also been increased buying interest for Iranian cargoes, because of the countrys proximity to India and its attractive pricing.

Trade discussions in general faded in Asia this week, with few buyers heard to be looking to conclude business. Given the recent downward price adjustments introduced by regional producers, prices were assessed stable-to-soft, to reflect some of the latest revisions.

On an ex-tank Singapore basis, Group I SN150 prices were assessed lower by $10-20/t at $830-$880/t, and SN500 at $820-$870/t. Bright stock was also down by $10/t at $1,160-$1,200/t.

Group I SN150 was heard at $750-$770/t FOB, while SN500 was mentioned at $720-$750/t FOB. Bright stock prices were slightly down at $1,120-$1,150/t FOB, despite the fact that this cut has faced less downward pressure than its counterparts because of a tighter supply/demand ratio.

Within the Group II segment, prices were assessed lower by $10/t at $710-$730/t FOB Asia for 150N, and at $720-$750/t FOB Asia for 500N, based mainly on bids and offers being discussed.

Group III prices have seen fewer downward revisions than Group II oils of late because Asian producers have been able to manage inventories and production so that the market has remained relatively balanced.

However, the Group III cuts have not remained completely immune to the downward pressure radiating from plummeting crude oil and raw material costs, and have also seen some adjustments over the last couple of months.

This week, Group III prices were assessed as stable compared to the previous week, with the 4 centiStoke and 6 cSt oils hovering at $1,000-$1,020/t FOB Asia. The 8 cSt grade was heard at $910-$940/t FOB Asia, after experiencing a $30/t drop the previous week.

The holiday slumber does not appear to have infected the shipping market yet, with several inquiries being discussed during the week, many of them involving shipments out of South Korea. A 1,000-metric ton cargo was quoted from Ulsan to Zhapu, China, for Jan. 5-10 lifting. An 800-ton lot was on the table for Ulsan to Tianjin, China, for Jan. 5-10 shipment. A 1,900-ton parcel of three grades was expected to be shipped from Onsan to Wakayama and Tsurumi, Japan, around Jan. 5-11. A 2,000-ton lot of two grades was likely to move from Onsan to Tianjin on Jan. 12-18. A 2,000-ton lot of two grades was expected to be shipped from Yeosu to Taichung, Taiwan, on a prompt basis. A 1,000-ton cargo of two grades was on the table for Yeosu to Tanjung Priok, Indonesia, for Jan. 5-15 lifting. A 1,000-ton lot, also containing two grades, was being discussed for Yeosu to Ho Chi Minh, Vietnam, for Jan. 1-15 shipment. A 3,000-ton cargo was likely to move from Yeosu to Caojing, China, for prompt shipment. A 3,000-ton lot was expected to be shipped from Daesan to Nantong, China, on Jan. 3-7.

Lastly, a 2,000-3,000-ton cargo was being quoted for Mizushima, Japan, to Hong Kong for Jan. 5-10 lifting.

Upstream, February ICE Brent Singapore futures were trading at U.S. $62.75 per barrel in afternoon trading on Dec. 22, compared to January numbers at $62.57 per barrel on Dec. 15.