Base oil buying interest in Asia continues to be weak, given ample supply and the possibility that prices may slide in coming weeks. Several Asian producers have decreased their list and spot prices in order to promote sales, but the strategy has met with limited success.
Buyers are waiting for prices to drop further, and are not willing to buy until that happens. Why would anyone buy product today if they think they can buy it cheaper tomorrow? a supplier lamented, citing volatile feedstock and crude oil prices, and plentiful base oil supplies as the main reasons for the recent price reductions. The supplier added that about 30 percent of the rationale behind the price markdowns could be attributed to the fall in crude oil prices, and 70 percent to the current market conditions.