Sources reported that ExxonMobils Group I cuts had also edged up by 12 cents/gal on Oct. 20, but there was no change for bright stock pricing either.

Along similar lines, Paulsboro will be increasing its Group I base oils by 12 cents/gal on Oct. 25, but the price of its bright stock will remain intact.

It was also heard belatedly that Avista Oil had moved up the price of its Group II ESR 50 base oil by 12 cents/gal on September 29. The price table in this issue of Lube Report, as well as the previous three issues, has been revised to show the adjustment.

Within the Group I and II segments, Motiva and Calumet were the only two producers who have not revised prices in recent weeks. Calumet was heard to be evaluating market conditions, but no price adjustment was reported by the issues deadline.

While a majority of Group II producers had issued price increases between late Sept. and mid-October due to a very snug market scenario – following hurricane-related plant outages – the Group I cuts also saw significant tightening as a number of buyers resorted to utilizing some of these cuts to replace Group II oils whenever possible. This trend had placed upward pressure on both posted and spot prices, sources explained.

Concerns over a shortage of certain grades has started to dissipate as news circulated that major producers Motiva and ExxonMobil had restarted their plants in Texas, and were heard to be running close to full rates, although availability of certain grades still remained strained.

The two producers allocation plans were still in place, but sources speculated that the programs may be lifted in late November or early December, as the suppliers were expected to be caught up on commitments by then.

There had also been reports that Chevrons refinery and base oil plant in Pascagoula, Mississippi, had been shut down following the series of storms that battered the U.S. Gulf between late August and early October. Sources indicated that the Pascagoula Base Oil Plant had resumed full production, following a thorough inspection and needed repairs.

Calumet shut down its Shreveport, Louisiana, paraffinic base oil plant for a scheduled turnaround in mid-October. The maintenance work was heard to be on schedule and expected to be completed on Nov. 1.

Calumet built inventories ahead of the turnaround to fulfill ratable business, but has not actively participated in the spot market in recent weeks to ensure historical accounts were covered. The Shreveport paraffinic plant has capacity to produce 4,800 b/d of Group I, 6,600 b/d of Group II, and 400 b/d of Group III oils, but only production of base stocks 150 vis and heavier were affected by the turnaround.

Given recent and ongoing plant outages, most U.S. suppliers have had little extra availability to offer on the spot market, but a more balanced situation was expected to emerge after the year-end holidays. No spot volumes are available at this time – check back around the end of the year, was what a number of buyers were told during recent negotiations.

In the meantime, it was heard that Mexican and South American consumers were on the lookout for available spot export cargoes in the U.S. as well, but were unable to locate sizable cargoes of Group I and II base oils.

A major U.S. refiner was heard to have raised its base oils sold through a distributor in Mexico as a result of the tight domestic scenario, and this was placing pressure on local lubricant values, sources said. With the local producer in Mexico, Pemex, still heard to be off-line, Mexican buyers continued to rely heavily on base oil imports.

Flint Hills Resources announced last week that it would no longer market products from the Excel Paralubes base oil plant in Westlake, Louisiana, as of January 2018 (for more details, please see Flint Hills to Exit Base Oil Marketing in the Oct. 18 issue of Lube Report). This will be limiting the number of supply choices available to Mexican consumers, sources said, since Flint Hills was heard to be a regular source of base oils.

Upstream, crude oil futures jumped on Tuesday, as Saudi Arabia reiterated its promise to help balance the global crude market by adhering to a production curb, while geopolitical tensions threatened global inventories, lifting U.S. prices to their highest finish since mid-April. Shale oil production has not risen as much as expected, contributing to the bullish trend as well.

On Tuesday, Oct. 24, West Texas Intermediate futures settled on the CME/Nymex at $52.47 per barrel, up 59 cents/bbl from $51.88 per barrel on Oct. 17.

Light Louisiana Sweet wholesale spot prices closed at $58.36 per barrel on Oct. 23, up from $57.76/bbl on Oct. 16, according to data from the U.S. Energy Information Administration.

Brent was trading at $58.33/bbl on the CME on Oct. 24, up 45 cents/bbl from $57.88/bbl on Oct. 17.

Low sulfur vacuum gas oil was at Dec WTI plus $13.50/bbl ($65.34/bbl) and high sulfur VGO was steady at crude plus $11.50/bbl ($63.34/bbl) on Oct. 20 (no data was available for Oct. 24 by press time). In comparison, low sulfur VGO was hovering at $65.87/bbl and high sulfur VGO at $62.62/bbl on Oct. 16, 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.