While Group II products continued to be tight, buyer sources said that traders and at least two producers were able to offer spot cargoes for December shipment – a change from a couple of weeks ago, when very little material was available for spot business.

Within the Group I segment, producers remained in sold-out positions, with one supplier not participating in spot business as it is building inventories for an upcoming turnaround, and a second producer reporting very low stocks due to a recent turnaround completed in early November.

A Colombian buyer was heard to be looking for a parcel of Group I SN300 and bright stock, but it could not be ascertained whether this requirement was fulfilled during the week.

There is still healthy buying interest from Mexico, and some discussions were expected to take place during the ICIS Base Oils conference on Nov. 29-Dec. 1 in Jersey City, New Jersey.

A Group II base oil cargo of U.S. origin was understood to have been fixed into Mexico this month, possibly for early December shipment, while a heavy-viscosity Group I parcel was heard to have been shipped there from Europe.

Buyers typically wait until close to the end of the year to secure spot volumes because the market tends to be more amply supplied then, and producers sometimes offer lower pricing to encourage orders.

However, given that the market is just coming out of a very snug supply period, sources said that there would likely be no real fire sales.

The overall market certainly heads into this December with tighter supplies than we have seen in recent memory due to the events of 2017, another source noted.

Activity in the domestic market has slowed down ahead of the holidays on Thursday and Friday, but base stock demand had been fairly healthy over the last couple of weeks, particularly since there have been increase announcements in the different finished lubricants segments.

Keen buying interest for spot imports was noted in India, but U.S. sellers said that it was difficult to make numbers work at the moment. Most cargoes were being shipped to India under contract in November; however, participants said some spot cargoes may become available in December from a couple of U.S. producers.

Upstream, crude oil futures inched up on Tuesday, supported by expectations of an extension of the OPEC output cuts at a meeting next week, but prices remained under pressure from signs of higher output in the U.S.

At the same time, the American Petroleum Institute was scheduled to release its U.S. crude oil inventory report on Nov. 21, and analysts expected it to show a large fall in stock levels.

Crude prices saw extremely choppy trading the previous week, with WTI prices dipping below $55 per barrel at one point, and then recovering by the end of the week. Last week also marked crudes first week of losses after five straight weeks of gains, various media reports noted.

WTI futures closed at $56.83 per barrel on the CME/Nymex on Tuesday, Nov. 21, up $1.13/bbl from $55.70/bbl on Nov. 14.

Light Louisiana Sweet wholesale spot prices settled at $62.14 per barrel on Nov. 20, down from $62.57/bbl on Nov. 13, according to data from the U.S. Energy Information Administration.

Brent was trading at $62.57/bbl on the CME on Nov. 21, down 36 cents/bbl from $62.21/bbl on Nov. 14.

Low sulfur vacuum gas oil was at Dec WTI plus $11.75/bbl ($67.84/bbl) and high sulfur VGO was at crude plus $10/bbl ($66.09/bbl) on Nov. 20. In comparison, low sulfur VGO was hovering at $68.76/bbl and high sulfur VGO at $66.76/bbl on Nov. 13, according to data published by PetroChemWire.

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