Asia’s base oil shipping market quiet on subdued trade

18 June 2012 04:45  [Source: ICIS news]

SINGAPORE (ICIS)--The Asian base oil shipping market was quiet in the week ended 18 June as weak demand across Asia hampered trading activity, market sources said on Monday.

“With the exception of regular volumes to India, base oil activity has been slow in the region,” a Singapore-based shipping broker.

Enquiries continued to be heard, but there were no fixtures. Inter-Asia shipping rates for 5,000 tonne parcels are generally stable at $40-60/tonne, a London-based trader said.

Meanwhile, 1,000-3,000 tonne parcels are headed for the Asian base oils export market, with freight rates at $120-130/tonne to Europe, a London-based shipping broker said.

Some small cargoes of base oils have been shipped with parcels of solvents, the London broker added.  

Buoyant fuel oil and gasoil prices as well as the sufficient base oil inventories of buyers in the region have contributed to the current sluggish demand, a Singapore-based trader said.

The prices of 3.5% fuel oil stood at $603-604/tonne (€476-477/tonne) on 12 June, up by $4/tonne week on week, while 0.5% gasoil prices fell by $5/tonne to $822-823/tonne in the same period, according to ICIS data.

Most market participants said they expect trading activity to pick up in July when buyers emerge to replenish their inventories.

($1 = €0.79)

By: Serena Seng

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