Ample supply and soft demand continue to weigh on base oil prices in Asia, while economic and sociopolitical uncertainties in the region also dampened requirements in the lubricant sector. –by Gabriela Wheeler
LNG Publishing Company
Editor, Base Oils
Gabriela Wheeler graduated with an MA in English from California Polytechnic State University in San Luis Obispo. She joined LNG in May 2013 as the editor of the U.S. and Asia base oil price reports, after holding editorial positions at Bobbin Blenheim, Burson Marsteller, and ICIS, where she was responsible for price reporting on several petrochemical markets, as well as base oils.
Wheeler has previously resided in Japan, Argentina, Poland and the Dominican Republic.
Some segments of the base oil market seem to be slightly longer than others in terms of supply, while demand was characterized as lukewarm for most grades, likely affected by economic uncertainties and unpredictable crude oil prices. –by Gabriela Wheeler
Producers were slightly relieved that crude oil and feedstock prices have pulled back, as margins had been squeezed by the recent price spikes. Efforts to raise base oil values met resistance because of soft market conditions. –by Gabriela Wheeler
With Saudi oil production being mostly restored following the recent drone attacks, concerns over feedstock shortages and price increases have largely abated in the Asian market. –by Gabriela Wheeler
The U.S. base oil market seemed to be moving at a sedate pace despite expectations that demand would pick up before slowing down again ahead of the Thanksgiving holiday in late November. –by Gabriela Wheeler
A general market slowdown and retreating crude oil numbers may have prompted ExxonMobil to rescind a price increase that the company had announced just days earlier. –by Gabriela Wheeler
Prices for a number of base oils inched up this week, driven by higher offers on the back of firm crude oil and feedstock values and thinning margins, while other grades remained flat on subdued demand. –by Gabriela Wheeler
Despite concerns about possible production outages caused by Tropical Storm Imelda in Texas, most base oil plants were reported running at normal rates and no product shortages were noted. –by Gabriela Wheeler
A great deal of market attention this week focused on the sharp crude oil price fluctuations triggered by drone attacks on two of Saudi Arabia's main crude oil facilities over the weekend. –by Gabriela Wheeler
Crude oil prices skyrocketed over the weekend after a drone attack disabled two of Saudi Arabia’s main oil production facilities, causing a great deal of concern to base oil producers – particularly if oil values remain at the lofty levels reached over the last couple of days. –by Gabriela Wheeler
Gabriela Wheeler observes how a small incident that takes place at one plant could trigger a long chain of unplanned events effecting business across the globe.
The Asian base oil market seemed to be pulled in different directions; on the one hand, abundant supplies and lackluster demand were weighing on prices, and on the other, firm crude oil values were squeezing margins and causing upward pressure on indications. –by Gabriela Wheeler
Recovery efforts in areas struck last week by Hurricane Dorian were ongoing, and while districts of the Abacos Islands and Grand Bahama have been completely devastated, areas along the United States Southeastern coast line have also suffered extensive damage, with a number of lubricant plants forced to shut down. –by Gabriela Wheeler
Asian base oil participants hoped to rekindle trading in September, after local holidays and adverse weather conditions thwarted trading and impacted logistics in parts of the region throughout the month of August. –by Gabriela Wheeler
The Labor Day holiday week would have been fairly uneventful except that attention was focused on the possible impact to production and transportation of severe weather conditions in the southeast of the United States. –by Gabriela Wheeler