Sunoco announced that it lifted all its base oils by 15 cents/gal on Monday, March 24, including 70, 150, 250, 500 and bright stock.

Chevron also said it increased its posted prices. The company upped its 100R by 5 cents/gal, raised 220R by 18 cents/gal and hiked 600R by 20 cents/gal on Tuesday, March 25. Chevron said the reasons behind the upward adjustments were rising raw material costs and a need to maintain the historical price differential between the U.S. Gulf and West coasts.

Apart from Chevron, no other major Group II producers have responded to the recent round of price hikes. Some sources now wonder if the remaining producers will follow, since crude prices have dropped back around the $100 per barrel mark. Other industry onlookers said crude values, even back to $100/bbl, combined with vacuum gas oil values holding up around $2.65 to 2.72/gal, still place a lot of pressure on base oilmargins.

Base oil volumes sold are largely on-target for late March business, according to both buyers and sellers. But both sides agree that there remains some competitive price activity for light neutrals – specifically 100 and 150 vis oils. Price ideas have been heard in a wide range from $2.60 to $3/gal FOB plant. The low to mid price points are said to be indicative of domestic movements, while the higher end is largely reflective of export shipments from the U.S. heading to Europe. Deals linked to Asian destinations are pegged somewhere in the middle of the price band, traders said.

Bright stock prices are said to be firm in the range of $3.45 to $3.60/gal FOB for both domestic and export (Europe/South America/Asia) opportunities. A number of suppliers report that bright stock availability has tightened in recent months, and inventories are running low.

At the same time, market talk has suggested that some spot offers for bright stock could be substantially discounted for shipments to Brownsville, Texas,and into Mexico. Although confirmation could not be obtained, sources hinted that prices for rail cars could be around $3.25 to $3.30/gal delivered. Most sellers say they are not willing to participate at these price levels.

Crude values have eased during the last several days, giving back about $10 to $11 since reaching an all-time high of just under $112 per barrel in recent weeks. Concerns over a dreary economic outlook and an oversupply of oil were said to be the main culprits driving crude prices lower – at least this week, analysts said.

At the close of the Tuesday, March 25 NYMEX session, the front-month May light sweet crude futures ended the day at $101.22/bbl, shedding a whopping $8.20/bbl from the week earlier settlement at $109.42.

Carolyn L. Green, based in Houston, can be reached directly at carolynlgreen@gmail.com.

Historic U.S. posted base oil prices and WTI and Brent crude spot prices are available for purchase in Excel format.