Base Oil Price Report


A quiet U.S. base oil market received a jolt this week, or at least a mild bump, with news that the Marathon-Ashland Petroleum refinery in Catlettsburg, Ky., will undergo an unscheduled two-week shutdown. The facility just recently came off a scheduled turn-around but mechanical problems were discovered Monday, sources said.

Producers and suppliers expressed differing opinions about the effect that the closure will have on the market. The refinery has capacity to produce 8,800 barrels per day of Group I base oil, most of which goes to Ashlands Valvoline Co.

Obviously this will affect Valvoline and the other customers for that plant, one source said. Theyll have to go elsewhere to buy more base stock for a little while. But its also going to have a ripple effect by tightening supply for the market as a whole.

Another observer, however, said the shutdown will probably have minimal effect, coming as it does during the lubricant industrys winter lull.

Demand is down, as it always is at this time of year, he said. There is probably oversupply in the market now, so I dont see this having an effect.

Base oil posted prices in the United States were unchanged but some sources noted that prices in Europe dropped last week. Some interpreted this as a sign that U.S. prices may fall soon, while others contended that prices in the two markets move independently.

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

Copyright 2002 LNG Publishing Co., Inc. All rights reserved.
Tim Sullivan, Editor. Lube Report, Lubes’n’Greases Magazine and Lubricants Industry Sourcebook are published by LNG Publishing Co., Inc.

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