Flint Hills Resources and Ergon joined other U.S. producers, upping paraffinic prices by 30 cents to 50 cents per gallon. This completes a full round of price hikes begun earlier this month.
Flint Hills increased its line up of API Group II neutrals between 30 cents/gal and 40 cents/gal this past Friday, April 15.The company pushed its 70 and 75 HC grades higher by 30 cents/gal, lifted 100 and 230 HC by 35 cents/gal and hoisted its 600 HC posting by 40 cents/gal.
Ergon said it plans to raise prices on its entire line of Group I neutrals by 35 to 50 cents/gal, effective Friday, April 22. Details of how much each grade will be upped were unavailable. (Ergon does not issue its postings in a public forum and therefore cannot be found in the price tables below.)
Several additive manufacturers, including Lubrizol, Afton and IPAC, revealed to customers their plans to increase additive package prices by an estimated 9 percent. In some cases, increases will be 10 to 12 percent, according to sources. A number of finished lubricant makers have also recently raised prices by an average of 9 percent.
While the U.S. lubricant market absorbs the recent rash of price increases for both paraffinic and naphthenic base oils, consumers also have to deal with tight supply, an ongoing situation. Certain grades remain more difficult to find than others. Most suppliers agree that all neutrals and pale oils are at best balanced.
There remain several sales allocations or sales controls in play for base oils, while in the downstream refining sectors, suppliers are enforcing extended product lead times.
There is no immediate relief in sight to help improve the availability of base stocks, sources say. A number of planned turnarounds are just completing or are about to commence. Some facilities have experienced unexpected operating glitches leaving producers unable to recover lost production. These events combined with dynamic demand have lead to limited opportunities for producers to build up inventories.
Feedstock costs remain a constant source of worry, as vacuum gas oil is tight as well as very costly. As mentioned in recent weeks, VGO can cost as much as $24 per barrel above WTI. This same premium over WTI also applies to other crude types, such as Light Louisiana sweet or LL sour or foreign crudes used by U.S. Gulf Coast refiners.
At the close of the Tuesday, April 19, NYMEX session, light sweet crude futures ended the day at $108.15 per barrel, a gain of $1.90 compared to the settlement a week earlier at $106.25/bbl.
Historic U.S. posted base oil prices and WTI and Brent crude spot prices are available for purchase in Excel format.