11 October 2010 02:34 [Source: ICIS news]
PALM SPRINGS (ICIS)--Rising crude oil prices and steady base oil demand are on everyone’s mind at this year’s US independent lubricant meeting, but buyers and sellers do not expect any major price change announcements at the event, sources said on Sunday.
“Even though crude prices are up, demand expectations are still unclear for the rest of year,” a paraffinic base oil seller said on the sidelines of the Independent Lubricant Manufacturers Association (ILMA) annual meeting. “I think everyone will spend more time focusing on how demand will play out first.”
The post Labor Day demand surge sellers expected has not yet surfaced and left many wondering if the rush could come later or simply point to a weak fourth quarter.
Meanwhile, benchmark crude oil prices have been hovering over $80/bbl (€57/bbl), up from the $76/bbl average at the time of the last base oil price hikes.
Posted paraffinic base oil prices have not changed since Group I sellers issued a price decrease in early August, a move that confused some buyers as supply was still not readily available for the heavy grades.
Many market participants viewed the August Group I decrease as more of a rescinding from the increase Group I sellers had issued in July, because other suppliers had not moved prices following that last increase.
Group II and III suppliers last issued posted hikes in May and June.
This year’s ILMA meeting runs from 9-12 October.
($1 = €0.71)
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