Base oils demand seemed to have reached a plateau, with many buyers holding off on acquiring additional volumes as fundamentals appeared muddled. Steeper crude oil and feedstock prices reversed some of the downward pressure that lackluster demand in some countries such as China had placed on spot base oil values. Upcoming plant turnarounds in Asia and the prospects of tightening supply were also supporting prices and may prompt buyers to secure products in the coming days.
While buying interest for imports in the key market China was disappointing, there are brighter spots such as Southeast Asia and India, where demand has picked up. Several cargoes were heard concluded from source countries such as Singapore and Thailand into neighboring nations. It is not clear why Chinese demand for imports has subsided; some observers blame a weaker-than-expected economic recovery, following the sudden abandoning of COVID-19 restrictions and an accompanying surge in infections late last year. These developments had led to reduced demand from downstream segments such as industrial and marine lubricants. General economic uncertainties and inflation were also dampening consumer sentiment around the world, possibly leading to reduced interest in Chinese manufactured goods.