Base Oil Price Report of Asia

(Last Updated On: 01/10/2018)

 

The Asian base oils market entered the year 2018 riding a wave of steep crude oil values and fairly balanced supply and demand conditions. It has encouraged some producers to introduce higher spot offers.

The suppliers were eager to offset some of the increases in feedstock costs that have squeezed margins in recent weeks. And they have therefore lifted some of their price expectations, depending on demand levels.

The lighter base oil grades within the API Group I and II segments were still heard to be leading the way in terms of requirements and were, therefore, more exposed to upward pressure.

Orders of Group I and II grades were also expected to strengthen as buyers were hoping to beat potential increases if conditions didn’t change.

While demand for Group III grades was predicted to display a steady, albeit moderate rise this year as applications that call for high performance, light viscosity oils are growing, this week, discussions revealed that prices were maintaining a fairly steady course. This was likely because of the supply of Group III cuts, in general, was ample in the region.

Although it was mostly export price indications that were climbing, prices at the local level were also inching up on firm fundamentals.

Such was the case of domestic list prices in Taiwan, where the local Group II producer, Formosa Petrochemical, was heard to have communicated price hikes for January shipments. The producer’s inventories were said to be balanced to tight, because of reduced operating rates at its base oils plant in Mai-Liao during last November, alongside a turnaround in an upstream unit. The next turnaround at Formosa’s base oil plant is scheduled for July this year.

Formosa was heard to be raising the domestic list price of its Group II 70N and 150N cuts by New Taiwan dollar (NT$) 1.34 per liter, while the producer’s 500N grade would be marked up by NT$ 0.41/l for January transactions.

In China, there was talk about domestic base oils prices moving up as well, while the government has also increased the official price of gasoline. It often impacts activity in the automotive sector and consequently. The base oils segment particularly, as some refiners might find it more lucrative to increase transportation fuel production versus base stocks.

Group I SN150 was steady at $700/t-$720/t ex-tank Singapore, while the SN500 grade was holding at $810/t-$830/t. The bright stock was also unchanged at $910/t-$930/t ex-tank.

Group II 150 neutral was assessed at $710/t-$730/t, and 500N was steady at $880/t-$900/t ex-tank Singapore.

According to FOB Asia basis, Group I SN150 edged up by $10/t to $630/t-$650/t, and the SN500 grade was heard at $730/t-$750/t.

Lubricants Oil Market
Lubricants Oil Market
Towards Biz

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Towards Biz is one of the dedicated news agency focused on Bangladesh Lubricants Oil Market.

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