Base oil prices in Asia were swayed by divergent currents, with some values moving up on tighter supply, and others falling due to sluggish demand and plentiful availability. Base oil requirements have not increased substantially over the last few weeks, and in fact, may have dropped on account of holidays in markets such as China and Taiwan, and unclear pricing trends in India. However, some base oils have become less available due to planned and unplanned production outages, and this was supporting their current value.
In the API Group I segment, plant shutdowns in Southeast Asia – where most Group I facilities are located – have led to a tightening of supplies and higher prices. Bright stock was particularly enjoying heightened attention as it remained in snug supply and prices have edged up. There was talk about European cargoes filling some of the supply gaps left by the absence of regional offers, but freight rates may be high given that vessels may have to circumvent the Suez Canal due to Houthi attacks on commercial ships and oil tankers in the Red Sea, which translated into higher costs and a longer voyage time.