Expectations for a surge in demand after the holiday period in August appear to have been misjudged, based on trading during the first week of September. The anticipated lift in demand has yet to happen, although there has been a tentative return to purchasing both small and large quantities of API Group I base oils for both export and domestic consumption around Europe, the Middle East and Africa.
Prices for Group I slipped again since the last report, although the rate of decline has slowed in export markets. Domestic or regional prices have crashed for September, but given that they were starting from perhaps artificial highs, the falls in pricing are not surprising. During August local prices were largely left at July levels, with buyers being very quiet during that month. Sellers came back for September negotiations to find that the markets had reversed, and that the advantage was held by buyers. This was as a result of the large downward adjustments in the Group I export markets, suggesting that high domestic levels were unsustainable.