U.S. Base Oil Price Report


The U.S. base oil market is a mixed bag this week, with demand dropping in some areas but not others.

Despite the normal August slowdown, the rumor mill has been hard at work. Sources say that some bright stock has been sold at fairly big discounts on the West Coast, supposedly below the ExxonMobil posted price for delivered product. A source speculated that one parcel sold for around $5.40 per gallon delivered on the West Coast.

One Northeast producer has acknowledged seeking a home for some surplus bright stock as well as for 60 vis.

Sources said Motiva hopes to lift sales allocations by Sept. 1, although they were unable to offer further details. They added that Motiva may also be considering realigning its Gulf Coast posted prices.

Buyers and sellers alike have been nervous about the U.S. and global financial turmoil of the past week, but several say their fear of a precipitous fall in pricing is abating. Many agreed that a base oil posting decrease may be on the horizon if crude continues in the $80s per barrel and demand doesnt rebound soon.

This week HollyFrontier temporarily removed its SN 525 posting for reassessment. The company expects to repost SN 525 in about a month. HollyFrontiers API Group I plant in Tulsa, Okla., has 9,500 barrels per day of capacity.

At the close of the Tuesday, Aug. 16, NYMEX session, light sweet crude futures ended the day at $86.65 per barrel, a hefty gain of $7.35 over the week earlier settlement at $79.30/bbl.

Historic U.S. posted base oil prices and WTI and Brent crude spot prices are available for purchase in Excel format.

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