20 September 2012 18:02 [Source: ICIS news]
HOUSTON (ICIS)--US Group I base oil prices are moving up in September, buyers and sellers said on Thursday.
Each of the Group I producers announced September increases on posted prices for all base oil grades.
ExxonMobil led the announcements, with a 15 cent/gal increase on its entire Group I grades, effective on 13 September, buyers confirmed.
Paulsboro Refining Co (PRC) followed at the same amount, with an effective date of 18 September.
HollyFrontier confirmed that it announced a 15 cent/gal increase on all grades, effective on 17 September. Calumet confirmed at the same amount, effective on 19 September, for its Group I 700 and brightstock base oils.
Ahead of the increase, SN 150 grade base oil posted prices were at $3.80/gal for Gulf coast product from a major supplier, moving to $3.95/gal following September announcements.
Brightstock prices for a mid-continent producer were at $4.72/gal in August, moving to $4.87/gal with the September increase.
Increases were underpinned by firm feedstock costs for West Texas Intermediate (WTI) and Brent crude oils, but strong premiums on vacuum gas oil (VGO) pushed the increase initiatives to the forefront, sources said.
VGO premiums over WTI rose between July and September from the mid-to-high $20s/bbl over WTI to the low-to-high $30s/bbl.
Higher VGO premiums were driven by gasoline production over these same months, sources said.
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