Base Oils Output Rebounded in March

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Base Oils Output Rebounded in March

Base oil production in the United States rebounded in March but remained 9% lower than the average output for that month in the previous five years, suggesting lingering impact from an unusual cold spate that struck Texas during the previous month.

The nation’s refiners produced 4.5 million barrels of mineral base oils in March, according to the latest data from the U.S. Energy Information Agency, up from 3.4 million barrels the previous month. The March total was still less than the running five-year average for that month of 4.9 million barrels, but it represented a significant recovery from the February total, which was 24% less than the running five-year average for that month.

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Base oil production around the world slumped throughout 2020 – initially because demand staggered during the early stages of the COVID-19 pandemic and later because base oil feedstock availability was constrained by sharp operational cutbacks at fuels refineries. U.S. production gradually recovered during the second half of the year and into January as demand for finished lubricants rebounded.

Output was knocked back in February, however, by the severe cold weather that struck Texas, home of the largest chunk of U.S. capacity. The weather triggered widespread power outages that forced temporary closures of many businesses, including some refineries.

While output partially rebounded in March, the total for that month was still the lowest for any month since August, except for February.

Refiners made 3.7 million barrels of paraffinic base oils in March – up from 2.8 million barrels in February but still 11% less than the running five-year average. Production of naphthenic base oils was 759,000 barrels, up from 608,000 barrels in February and 5% above the running five-year average.

The country imported 1.1 million barrels of base oils in March. That was 21% below the running five-year average for the month.

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