Base Oil Price Report

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Price increases continued to buffet the U.S. base oil market the past week, this time on the naphthenic side of the industry. Several pale oil suppliers announced plans to impose markups ranging from 6 cents to 10 cents per gallon this month, and the rest of the market was expected to do likewise.

The increases in naphthenic prices come in the wake of another round of hikes by paraffinic producers during the latter half of July. The most recent previous increase for naphthenics took place in June.

Nynas kicked off the latest round, announcing July 26 that it will impose an across-the-board increase of 10 cents per gallon for North America on Aug. 10. Market leader Ergon said subsequently that it willadd 6 cents to grades 500 and higher and 10 cents to lighter grades, effective Aug. 8.

Cross Oil said it will raiseprices on grades of 150 and lower by a dime and those on 200 and higher by 6 cents, effectiveAug. 15, while and San Joaquin Refining said it will raise all prices 10 centslater this month, although an exact date has yet to be set. Calumet and Citgo were also expected toraise prices, although they had made no specific announcements by the close of business yesterday.

Rising crude oil costs were once again cited as a factor in the latest round of increases, although suppliers added that energy and transportation costs are also a factor.

It is crude driven, and its also because of extraneous costs, one marketer said. Weve been chasing crude [with previous increases] and havent even been able to address costs for things such as transportation, which have also gone up. Those things are really starting to become issues now.

Market observers said some suppliers imposed smaller markups for heavy grades because supply for them is looser than for lighter grades.

Crude oil costs jumped again the past week, with the price on the New York Mercantile Exchange closing yesterday at $61.93 per barrel, up $3.04 from seven days earlier.

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

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