Middle East base oils market activity picks up on stronger demand

09 October 2012 09:05  [Source: ICIS news]

DUBAI (ICIS)--Activity in the Middle East base oils market has started to pick up on the back of strengthening demand, following recent sharp price declines, market sources said on Tuesday.

Prices of Group I SN500, the most widely traded grade of base oils, were assessed at $970-1,010/tonne (€747-778/tonne) CFR (cost & freight) UAE on 4 October, unchanged from the previous week, after shedding more than 8% from 20 September, according to ICIS.

For SN150 base oils, prices were likewise unchanged at $920-940/tonne CFR UAE for the past two weeks, following a 5% decline from 20 September, according to ICIS.

Trading activity has gained momentum, with a few discussions taking place for Group I base oils following Iranian supplier Iranol Oil's tender for SN150, SN500 and brightstock 150.

"The market is slowly picking up after being quiet in late September, so we may have some firm negotiations and deals taking place by the year's end," said a trader at the sidelines of the ICIS Middle Eastern Base Oils and Lubricants conference in Dubai.

The two-day conference on 9-10 October is expected to draw more than 300 delegates in the base oils and lubricants sector from the Middle East, Europe and Africa.

"Lubricant demand traditionally reaches its peak in September-November, but was delayed because of long domestic supply and soft demand throughout most of September," another trader said.

Market players expect increased trade during the conference.

"We are seeking some fresh cargoes, but prefer to wait until prices stabilise or drop slightly further before we proceed," a regional buyer said.

($1 = €0.77)

By: Andrea Heng
+65 6780 4359

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