Valero Energy Corp. confirmed lowering posted prices for at least some of its products but details were unavailable.

Whereas this round of cuts was widely expected during recent weeks, there appears to be more variance of opinion about where the market will head from here. One marketer predicted that base oil prices have bottomed out and will increase during the first quarter of 2002 as motor oil production ramps up in anticipation of the summer peak driving season.

We believe prices have come down to a level that makes sense for right now,the marketer said. Were looking for them to increase when demand goes back up.

One large purchaser contended that there may be room for yet another round of cuts, although she emphasized that the future, at this moment, is unusually difficult to predict.

I dont think prices will move again this year, she said. But inventories seem to be up, especially for Group I, and if that continues to be the case, I can see prices coming down more.

She added, however, that the scenario could change completely if, for example, the United States triggers an oil embargo by widening its war on terrorism to include Iraq. Or it is also possible, she said, that fear of flying will lead people to travel more by car, thereby strengthening demand.

Theres so much up in the air right now, its hard to say whats going to happen, she said.

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