Those actions followed ChevronTexacos announcement of a 7-cent increase last week. ExxonMobil, which does not produce Group II stocks, added a nickel to its Group II-plus postings April 9.

Group I suppliers announced no changes, and sources concluded that their end of the market has missed out on this round of increases, the first in more than a year. Base oil refiners in general have been eager to raise prices as costs for crude oil have risen more than 25 percent so far this year. Base oil suppliers and purchasers agree that Group II suppliers were able to raise prices, and Group I suppliers were not, because of the introduction of new motor oils.

API GF-3 passenger car motor oils and API CI-4 heavy-duty motor oils, introduced last July and December, respectively, both demand higher quantities of premium base stocks. As a result, demand for Group II and Group II-plus tightened while demand for Group I softened.

Margins are in the tank and (Group II) tanks are low, quipped one source. Why not increase prices?

Observers speculated that the widening of the spread between Group I and Group II stocks would cause a limited shift back toward Group I.

If these Group II increases hold, I would assume that blenders who have any flexibility would try to optimize their use of Group I, one large purchaser said. If that happens, maybe it will take care of this imbalance.

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