Nynas AB announced May 12 that Petroleos de Venezuela S.A. sold a 35 percent stake in the company and that the United States lifted sanctions against Nynas as a result of the divestment.
Officials in Venezuela’s embattled government have drafted a plan to restructure the country’s sacred national oil company, Petroleos de Venezuela S.A., proposing among other things to create a Russian subsidiary that would absorb at least a stake in Nynas AB.
Global base oil markets are under intense pressure as the threat of a worldwide recession sinks demand for lubricants amid few signs of an early respite in the coronavirus pandemic. Middle East base oil refiners’ push for a bigger piece of the API Group II and III base oil market now leaves them exposed in a global base oil supply glut, along with a drop in base oil demand and prices due to the pandemic’s economic impacts.
Base oil shipments coming from Russia and other members of the Commonwealth of Independent States are facing logistical obstacles in the midst of the coronavirus pandemic.
Chinese base oil and lubricants plants have closed, and trade flows are being constricted by the rapidly spreading coronavrius epidemic.
Base oil refiners in the Middle East face a slowdown in business from China, following the outbreak of the deadly coronavirus as the crisis shreds lubricant and grease demand in key sectors.
United States sanctions have forced Iranian refiners to find alternative export channels for their API Group I base oil to avoid detection and shore up vital export revenues, an executive at an Iranian shipping agency told Lube Report.
It is unlikely that the European Commission will review the new duty-free API Group II base oil import quota that it adopted late last year, according to industry sources. The quota has caused confusion around the industry regarding its enforcement and led to increased costs for companies.
A dramatic increase in base oil availability from the Middle East is fueling a supply glut that could exceed 3 million metric tons a year, according to an industry executive.
Renewed fears arose of disruption to base oil supplies from the Middle East, following the United States killing on Jan. 3 of Iranian Major General Qasem Soleimani in Iraq.