With few trading days between Christmas and New Years and most players taking additional leave, EMEA base oil markets are largely closed.
Crude oil and petroleum products markets have remained relatively static, with colder weather throughout Europe putting a small degree of added demand into gas oil values. Dated Brent has marked time at around $111.00 per barrel, almost exactly on par with last week. ICE gas oil has moved up to around $944 per metric ton for current front month trades, but with no real action over the past few days, and few to come, no real movements in these markets is anticipated until after New Years.
The resultant status quo scene therefore remains in place for most base oil prices, with the underlying trend really only reflecting notional market prices. European API Group I levels are left unchanged at the following prices. Light solvent neutrals are left around $930-$945/t, along with neutrals such as SN 500 between $955-$970/t. Bright stock is set to continue at $1075-$1100/t.
These prices refer to cargo sized parcels of Group I grades loading on an FOB basis out of mainstream European and North African outlets, where availability permits.
Local European trade has been limited to a small number of truck and barge deliveries made over the last few days. Without any real commercial transactions taking place, prices for domestic trades are left untouched from last week. Differentials are maintained with local prices 65-80/t higher than export levels reported above.
Baltic and Black Seas
Baltic trades have reported no new cargoes discussed or completed, but a number of loadings are continuing for parcels already negotiated some time back. For the sake of continuity prices are maintained as per last weeks report at $850-$860/t for the two grades SN 150 and SN 500 respectively. SN 900 prices are confirmed between $900 and $935/t basis FOB in bulk. A number of offers for flexies were left on the table over the Christmas period at around $975/t for either of the main grades.
Black Sea shows in a similar vein, but without the number of cargoes being loaded. Business has all but ceased in cross-trade traffic, with no Turkish import activity coming to light. Prices were not reported for this region last week, but to maintain notional continuity, Russian SN 150 and SN 500 would be offered at between $900 and $920/t CIF Gebze, with Uzbek SN 150 at around $885/t on the same basis. It is rumored but still not confirmed that a large parcel of Russian SN 500 may have been loaded out of Theodosia for deep-sea export to west coast of India and/or United Arab Emirates. The pricing for this parcel is estimated to be around $825/t FOB.
Middle East
Near Middle East and Red Sea regions are also relatively quiet, with war-torn areas such as Syria and now Lebanon proving to be long term casualties to base oil trade into these countries. Red Sea exports appear to be continuing along with one comment received. Large quantities of base oil are being transported within this region by road, with the result that many exports to the Middle East Gulf and Gulf Cooperation Council receivers go unrecognized unless identified with sea-going vessels.
Although the Middle East Gulf is certainly affected by the seasonal holidays elsewhere, trade is still continuing at least on a physical basis, making this region the busiest throughout the EMEA markets. There is a definite slowdown in commercial activity, with even sources such as Iran lowering expectations for concluding deals to export material.
Prices for Iranian SN 500 ex BIK are maintained around $900-$905/t in U.S. dollar equivalent, with re-exported bulk SN 500 is being offered at $9910-$920/t FOB U.A.E. ports. Imported and locally produced prime Group I material is held around $1015-$1055/t for light and heavy solvent neutrals, and bright stock at $1100-$1125/t.
Africa
East Africa and South African sources have reported no new business taking place during the last few days, with most contacts not available for comment.
Nothing new is reported from West African receivers or traders, and prices for landed cargoes are maintained in the same ball park as last reported. Group I solvent neutrals are estimated at $985-$1045/t. Bright stock prices depend on source with prices between $1065-$1175/t. SN 900 imports from the Baltic are a little greyer than most prices with suggestions that some offers have contained prices below $1000/t CFR, with the more normal range being reported between $1025-$1045/t.
Group II/III
Group II prices within Europe remain unchanged with levels between $1065-$1090/t for light vis grades, and heavy grades between $1125-$1185/t.
Middle East Gulf Group II prices are under discussion for the next round of imports into this region, but no clear picture has evolved as yet. Further clarification for January and February levels will only become available in the next couple of weeks.
Levels are maintained between $1030-$1045/t in respect of 150N and 220N, with heavy vis material between $1120-$1145/t. Prices are based on levels CIF U.A.E. ports.
European Group III prices are unchanged with European activity at a seasonal low. Prices are therefore maintained as 910/t for 4 cSt material and 920/t in respect of 6 cSt grades, all on basis of prices ex tank Antwerp-Rotterdam-Amsterdam.
Ray Masson is director of Pumacrown Ltd., a trader and broker of petroleum products in East Grinstead, U.K. Contact him directly at pumacrown@email.com.
