Prices are rising again on both the paraffinic and naphthenic sides of the U.S. base oil market. ExxonMobil hiked posted paraffinicprices between 10 cents and 13 cents per gallon Monday and was followed by Citgo and Calumet in what could become the fourth round of increases this year. Ergon, Calumet and Nynas said they will raise prices on pale oils by 10 cents to 15 cents per gallon.
ExxonMobils movement, announced June 1, added 10 cents per gallon to posted prices for Group I 100 and 150 neutrals and 13 cents to postings for all other products. Citgo took similar action, imposing increases of 10 cents on grades 150 and lighter while moving up 13 cents on middle- and heavy-viscosity oils. Its changes also took effect Monday. Calumet said it will raise prices 13 cents per gallon across the board tomorrow.
There was no word of changes by other major paraffinic suppliers by the close of business yesterday, but sources predicted they too will raise prices.
Ergon, the continents biggest naphthenic producer, said it will raise the price on its 60 pale oil by 15 cents per gallon and go upbetween 10 cents and 15 cents on 100 palewhile adding 10 cents to prices for all other oils, effective Monday. Nynas and Calumet said they will follow the same pattern on Monday and June 20, respectively.
Ergon also stated that base oil production will probably not be affected by a new equipment problem at its refinery in Vicksburg, Miss. Officials confirmed that exchangers in a crude unit had fouled out, forcing a reduction in throughput. The naphthenic base oil plant, however, was already operating at reduced levels because of expired parts in a hydrotreater. Officials said the base oil plant can continue operating at current levels using inventories of vacuum gas oil. The company expects both equipment problems to be repaired within the next week.
Sources said sellers attributed the weeks price increases to continued tightness in availability of both paraffinic and naphthenic stocks, along with high costs for crude oil. The price of crude on the New York Mercantile Exchange closed yesterday at $72.45 per barrel, according to Bloomberg. That was 54 cents higher than a week earlier.
Historic U.S. posted base oil prices and WTI and Brent crude spot prices are available for purchase in Excel format.