Most U.S. naphthenic base oil producers this week announced price increases on at least some grades, effective June 11, generally by 7 to 10 cents per gallon, matching the price hikes announced last week by Nynas. ConocoPhillips last week raised posted prices on its higher viscosity paraffinic Group II and Group III stocks from 5 to 15 cents per gallon.
ConocoPhillips was the last of the U.S. paraffinic producers east of the Rocky Mountains to follow the latest market move, initiated by ExxonMobil two weeks ago. Effective June 1, the price on their 70 and 80 neutrals remained unchanged while the 110 neutral increased 5 cents per gallon, the 225 increased 10 cents per gallon, the 600 increased by 15 cents per gallon, and all Group III grades increased by 10 cents per gallon. ConocoPhillips markets Group III stocks produced in Korea by S Oil.
Sources reported no price change from Chevron thus far. Refining industry conditions on the West Coast are reported to be different than the rest of the country. With ample gasoline supplies, all refineries running well, and fuel prices nearly on par with the rest of the country, some base stock buyers are speculating whether an increase is forthcoming.
A spokesman from Petro-Canada confirmed that their catalyst change-out was completed successfully, and they are back on line. Petro-Canada experienced no supply disruptions, due primarily to inventory built prior to the maintenance work.
The paraffinic market was otherwise relatively quiet this week with normal operations reported by all producers.
Regarding the naphthenic market, Cross moved prices on low viscosity grades effective June 1, and is evaluating the heavier grades. Calumet is moving some grades upward, effective June 11, by 7 cents per gallon. Ergon is moving prices upward by 7 to 10 cents per gallon, depending on grade, effective June 11. San Joaquin Refining continues to evaluate the market, but has elected not to move prices thus far. The 7 to 10 cent-per-gallon move by Nynas, also effective June 11, was reported initially last week.
Demand for naphthenic stocks was reported to be strong, with supply balanced to snug, depending on the grade. The Cross plant was reported to be running well, and Cross began shipments to customers this past weekend. San Joaquin reported its plant running well and at capacity following its turnaround in April.
Crude closed at $65.61 per barrel yesterday on the New York Mercantile Exchange, according to Bloomberg. That was $2.46 above the price one week ago. Publishers note: Mark Matsonretired last year from Marathon Petroleum after spendingover 27 years in the finished lubricants and base oils businesses. He and wife Deblive on a farm in Ohio, where they breed, train and show Tennessee Walking Horses. When not making hay, he can be reached at mdmatson@gte.net.
Historic U.S. posted base oil prices and WTI and Brent crude spot prices are available for purchase in Excel format.