Despite the fact that domestic base oil demand has shown few signs of strengthening, the market seemed to be fairly balanced thanks to the endeavors of a number of suppliers who concluded export transactions over the last few weeks, lowering their inventories and avoiding a significant product overhang. Upcoming turnarounds also helped reduce surplus volumes as the affected producers were building inventories. Prices reflected the balanced conditions in that they remained fairly stable, although spot deals were taking place below contract levels.
Demand from most lubricant segments was less vigorous than expected for this time of the year, although there were upticks in some segments such as the industrial and automotive applications. The Memorial Day holiday on May 29, which traditionally marks the start of the summer driving season, was just around the corner and suppliers hoped that this meant that additional requirements would start to roll in. Still, finished lubricant inventories were substantial and this kept buyers from returning to the base oil market to procure more product.