Asia Base Oil Price Report(AUGUST,29 2017)

2017-09-04 作者：润滑油情报网   来源： 网友评论 0 条

    The base oil market in Asia appeared to be in a holding pattern as both buyers and sellers assessed conditions and considered possible actions moving forward, with few spot deals reported.

Some attention was focused on supply disruptions in the United States after Hurricane Harvey made landfall near Corpus Christi, Texas, on August 25, pouring more than 20 inches of rain in 24 hours over Houston and nearby areas – a region that is home to a large number of refineries and chemical plants.

Several production units were taken off-line ahead of the tropical storm as a precautionary measure, and others were forced to shut down due to flooding, including ExxonMobil's API Group I//II refinery in Baytown; Lyondell/Basell's Group II and naphthenic base oils plant in Houston; and Valero’s naphthenic base oil plant in Three Rivers. The status of Motiva's Port Arthur refinery could not be confirmed at the time of writing. Approximately 15 percent of U.S. refining capacity was reportedly shut down by Monday.

Aside from these production outages, the movement of base oils was likely to be impacted by port closures and the suspension of railcar transportation during and after the storm, sources said.

Base oil supply in the U.S. typically lengthens at the end of summer, and extra volumes have in the past been exported to India and China at competitive prices.

However, this may not be the case this year as the domestic U.S. market has remained quite snug over the last three months, and is likely to see further tightening as a result of production outages due to the storm.

Additionally, another factor that could be affecting product availability in India in particular was the ongoing turnaround of a base oil plant in Iran. Iranian Group I base oils are regularly exported into India and compete with local product.

Iranian producer Sepahan Oil was heard to have shut down its Esfahan base oil unit for a month of maintenance starting in mid-August. The plant can produce 420,000 metric tons per year of Group I oils, according to Lubes’n’Greases’ Global Guide to Base Oil Refining.

Meanwhile, in China, shipping operations have also been affected by severe weather. Typhoon Pakhar made landfall in the city of Taishan, Guangdong province, on Aug. 27, only days after Typhoon Hato had hit the same province. The typhoon caused the closure of private and government offices, ports, and the suspension of vessel movements in southern China.

Also in China, it was heard that Abu Dhabi National Oil Co (Adnoc) had offered Group III cargoes at very competitive prices in an effort to protect or expand market share ahead of Shell-Qatar Petroleum’s Group III base oils entering the supply system once again.

Group III availability in Asia was anticipated to increase with the return to production of the Shell-Qatar Petroleum Pearl gas-to-liquids (GTL) refinery in Ras Laffan, Qatar, following an extended and unexpected shutdown that started late last year.

The Pearl GTL unit can produce 300,000 metric tons per year of Group II and 1,072,000 t/y of Group III base oils, and was understood to have been restarted. Shell utilizes a large portion of these base oils in its own downstream lubricant facilities.

There was also talk about Group I prices coming under pressure given increased availability of these grades as demand in some Asian markets has declined and supply became more plentiful.

The solvent neutral 500 cut, in particular, was mentioned has having elicited lower buying ideas as demand for the heavier grades tends to wane in the winter months.

As a result, some spot price assessments in Asia remained unchanged week on week, but a number of grades were revised down to reflect bids and offers, as certain cuts were exposed to downward pressure.

On an ex-tank Singapore basis, Group I SN150 was steady at between U.S. $670 and $690 per metric ton. SN500 and bright stock were also unchanged at $830/t-$850/t and $920/t-$940/t, respectively.

Group II 150 neutral was hovering at $680/t-$700/t, and 500N was assessed at $880/t-$900/t ex-tank Singapore.

On an FOB Asia basis, Group I SN150 was steady at $560/t-$580/t. The SN500 cut was revised down by $20/t at $710/t-$730/t FOB Asia on lower bids and offers. Bright stock was holding at $750/t-$770/t FOB Asia.

Group II 150 neutral was heard at $570-590/t, and the 500N/600N grades at $800/t-$820/t, all FOB Asia.

In the Group III segment, prices were notionally adjusted down by $10/t as downward pressure on these cuts emerged, with the 4 centiStoke and the 6 cSt grades at $750/t-$770/t, and the 8 cSt cut at $730/t-$750/t FOB Asia.

Upstream, crude oil futures dropped sharply on Monday, as traders expected refinery shutdowns in the U.S. Gulf to bring about an excess in crude supplies on the back of the Harvey storm.

ICE Brent Singapore October futures were hovering at $52.52 per barrel at the close of Asia’s trading on August 28, from $52.62/bbl on August 21.