Asia Base Oil Price Report(November 22,2017)

2017-11-22 作者：　润滑油情报网   来源： 网友评论 0 条

Higher offers were circulating the Asian base oil segment, but buyers were resisting the steeper prices as demand from downstream markets slowed and uncertainties lingered.

Participants acknowledged that recent hikes in crude oil and feedstock prices were driving base oil price indications up, but November and December are typically weaker months in terms of requirements, and buyers were not willing to commit to large volumes unless absolutely necessary.

Most consumers were limiting their purchases to just what’s needed to keep operations running, as players prefer to end the year with minimum stocks in their hands.

In fact, some buyers said that they would rather wait until the last minute to conclude purchases. “Sometimes there are good year-end deals to be had,” a source noted.

Sellers, on the other hand, held on to offer levels as most fundamentals remained the same as they have over the last couple of weeks, supporting stable to firm pricing.

Crude oil prices have registered two-year highs, and while they fell last week on increased U.S. shale production, Brent continued to hover well above U.S. $60 per barrel. Investors also appeared concerned about the political turmoil in Saudi Arabia, and expected values to stay at current levels for a while, particularly if OPEC members agreed to an extension of the output cuts.

On Monday, Nov. 20, Brent for January delivery on the London-based ICE Futures Europe exchange was trading at $62.06 per barrel, from $63.35/bbl on Nov. 13.

Base oil buying interest in key markets like China have declined with the approach of the end of the year, but suppliers were still intent on raising prices.

It was heard that imports of API Group II and III base oils had moved up by at least $10 to $20 per metric ton week on week, and offers from a major Middle East supplier were heard to have jumped by $30/t for November shipments of Group III products.

Likewise, Group I import indications were heard to have climbed in India, as Iranian producers have lifted indications by around $10/t on the back of higher crude values.

Participants also said that bright stock prices in India were exposed to upward pressure given the current tightness affecting the market.

Concerns about limited supply of Group II oils in the U.S. and restricted availability for export into India were tempered by news that a few traders had fresh spot cargoes for loading in December.

This was due to the fact that most facilities in the U.S. have restarted production following unplanned shutdowns caused by Hurricane Harvey in September.

At the same time, reduced operating rates and unexpected shutdowns at Asian base oil facilities were keeping supply and demand fairly balanced in the region.

Taiwanese Group II producer Formosa Petrochemical Corp. was heard to be running its plant in Mailiao at 80 percent capacity due to a turnaround at an upstream refining unit. As a result, the supplier was understood to have reduced the amount of base oils shipped under contract to China, and has suspended spot shipments in November. Formosa has capacity to produce 600,000 metric tons per year of Group II oils, according to Lubes’n’Greases’ Guide to Global Base Oil Refining.

In South Korea, there were reports that GS Caltex had shut down its base oils facility in Yeosu at the beginning of November for a turnaround that would last about one month.

The unit had been shut down last March for a catalyst change, and was heard to have been taken off-line again for adjustments to the next-generation catalyst that had been installed at that time, according to sources. Sources also said that production should increase once the plant restarts and the catalyst was working fully. The plant has capacity to produce 1,151,000 metric tons per year of Group II base oils and 146,000 t/y of Group III oils. There was no producer confirmation about the shutdown or about changes to output volumes.

Spot assessments in Asia were generally stable to slightly firmer this week, with discussions for December loading starting to emerge.

Group I solvent neutral 150 was heard up by $10/t at between $690/t and $710/t ex-tank Singapore, while the SN500 grade was also up by $10/t at the low end of the range at $810/t-$830/t. Bright stock was holding at $910/t-$930/t ex-tank.

Group II 150 neutral was assessed at $700/t-$720/t, and 500N was steady at $870/t-$890/t ex-tank Singapore.

On an FOB Asia basis, Group I SN150 was up by $10/t at $590/t-$610/t, and the SN500 cut was up by $5/t at $710/t-$730/t, FOB Asia. Bright stock was stable at $740/t-$770/t, FOB Asia.

Group II 150N was steady at $600/t-$620/t, and the 500N/600N grades were up by $5/t at $770/t-$800/t, all FOB Asia.

In the Group III segment, 4 centiStoke and 6 cSt grades were stable, following an upward adjustment the previous week, at $780/t-$800/t. The 8 cSt was also steady at $750/t-$770/t, FOB Asia.