No further posted price moves were detected in the market, yet some participants wondered whether API Group III postings as well as naphthenic prices will follow the trend set within the Group I, II and II+ sectors over the past month.

Market activity drew a mixed bag of opinions. The more popular viewpoint is that the U.S. market is solid; demand continues to improve while supply continues to dwindle. In many cases, suppliers contend they are nearly or completely sold out of most grades. Other suppliers report they have largely balanced inventory positions, but could – at the right price – entertain spot opportunities.

Fresh export possibilities have emerged with generally healthy offshore demand spotted in deep-sea destinations. While Europe remains the quietest area, U.S. sellers of both paraffinic and naphthenic grades have seen doors opening to ship to India, the Middle East, and South America.

Meanwhile, in the United States, sources acknowledge that overall market conditions continue to improve despite the still-depressed situation throughout much of Europe. Traders pointed out that prices remain under downward pressure there, but see an upward price trend locally.

Base oil producers’ operating costs are still considered hefty, while bottom line profits are still squeezed, in spite of the recent increases pushed through for a large portion of paraffinic cuts. Vacuum gas oil values have dipped from their highs, but remain at a premium in the mid-$20s per barrel over WTI. VGO values and differentials are a key tools in the pricing of base oils.

At the close of the Tuesday, April 2, CME/Nymex session, front month light sweet crude oil futures ended the day at $97.19 per barrel, up 85 cents/bbl from last weeks settlement at $96.34.

Brent crude was trading at $110.70/bbl at the end of the day yesterday, up $1.41/bbl from its week-ago level of $109.29.

LLS (Light Louisiana Sweet) crude was trading at a premium of $17.75/bbl to WTI on Tuesday.