Spot base oil prices were steady to slightly lower in Asia, but the downward adjustments were less precipitous than at the beginning of August. While there was concern about oversupply and producers were doing their utmost to place their extra barrels, buying interest in distant destinations allowed suppliers to conclude several export transactions and lower inventories at home. Furthermore, refiners have started to dial back production to reduce the product overhang leading to a more balanced supply and demand scenario.
Participants noted that a number of Northeast Asian cargoes had been offered to receivers in the Americas and the Middle East. For example, about 40,000 metric tons of base oils were being discussed for shipment from South Korea to the United States Gulf in early September. A 10,000-metric ton cargo was also expected to be shipped from Mailiao, Taiwan, to Hamriyah, United Arab Emirates, in early October, while a 4,500-metric ton prompt lot was discussed to cover Pyongtaek, South Korea, to Hamriyah.