Europe export base oil prices slide due to ongoing weak demand

27 September 2011 23:59  [Source: ICIS news]

LONDON (ICIS)--European export base oil solvent neutral (SN)150 and SN500 spot prices have declined $30/tonne (€22/tonne) this week because of ongoing sluggish demand, market sources said on Tuesday.

The European group I base oils market remains soft. Dismal economic news and falling crude prices are encouraging hand-to-mouth purchasing, which is exacerbating an already imbalanced supply/demand situation.

Stocks are mounting at refineries and producers are lowering offers in an attempt to move cargoes in a slow market.

Accordingly, group I base oil export prices are sliding. One west European producer conceded it was offering discounts to traders and buyers in a bid to generate some interest.

“Everyone is very cautious,” the producer said. “All the potential buyers are saying ‘let’s wait a bit’.”

A UK-based trader confirmed this view. “We do not have the demand, so we are scared to take product,” they said. 

In the week ending 27 September, ICIS assessed SN150 and SN500 FOB Europe export spot prices down by $30/tonne to $1,210–1,250/tonne and $1,230–1,260/tonne respectively.

($1 = €0.74)

By: Carl Roache
+44 20 8652 3214

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