News of additional posted price hikes from Chevron, Citgo, Valero, Sunoco and SK reached the market this week, following the ExxonMobil and Calumet moves reported a week ago.
Chevron said that it raised posted prices by 20 cents per gallon effective today, Dec. 5, on its Group II 100R, 220R and 600R grades. The upward adjustment is an effort to retain the historical price differential between the U.S. Gulf and West Coasts, said Chevron.
Citgo increased its Group I postings last Thursday, Nov. 29, adding 5 to 20 cents per gallon. Light vis paraffinic 85 and 100 solvent neutrals inched up 5 cents; 150 neutral went up 10 cents; and grades 325, 650 and bright stock climbed 20 cents per gallon.
Valero raised all its Group I East Coast solvent neutral postings effective today, Dec. 5, by 20 cents/gal, as well as its 145-150 vis neutral Group II cut.
Sunoco jumped on board with hikes of 6 cents/gal for 70 vis, 10 cents/gal on 148 vis, 15 cents/gal for 250 and 500 vis, and 20 cents/gal for bright stock, effective Friday, Dec. 7.
SK announced increases of 20 cents/gal across the board for its posted Group III base stocks, effective Monday, Dec. 3. And rounding out this weeks adjustments, American Refinery Group followed the 20 cents/gal ExxonMobil move.
Naphthenic producers are keeping a close watch on the direction of crude prices before deciding if another wave of hikes would be warranted for December business. Most suppliers of pale oils report that demand is fairly steady considering that December is usually slow. Price increases of 15 cents/gal pushed through in mid-November on virtually all naphthenic and process oils are sticking, suppliers said.
Meanwhile, crude values continue to slid, slipping below the $88 per barrel mark this week on speculation OPEC may increase production at its meeting today.
The Organization of Petroleum Exporting Countries will meet in Abu Dhabi to decide on output for early 2008. A source close to OPEC said that boosting production would help prevent accusations the group is doing nothing to ease high prices.
Some analysts speculate OPEC could be comfortable with prices at $90/bbl, especially given the fact that the U.S. economy appears to be teetering on the edge of a recession, suggesting a reduction in oil consumption may be on the horizon.
Prices have dropped from record highs of over $98/bbl on speculation that sub-prime mortgage losses in the U.S. will spread through the economy, reducing growth and demand for transportation fuels.
At the close of the Tuesday NYMEX session, light sweet crude settled at $88.32 per barrel. This represents a loss of $6.10/bbl compared with the week-ago settlement, and is down almost $10 from the Nov. 20 close at $98.03/bbl.
Carolyn L. Green, based in Houston, can be reached directly at
Historic U.S. posted base oil prices and WTI and Brent crude spot prices are available for purchase in Excel format.