17 September 2013 19:39 [Source: ICIS news]
LONDON (ICIS)--European Group III domestic base oils prices are holding steady, despite recent falls in the value of crude futures, sources said on Tuesday.
“People keep saying [SN] 500 is tight, but there is no shortage of product. I have four different offers on the table. Some are more competitive than others,” said a buyer.
The buyer added that traders were all expecting prices to firm and were therefore not willing to fix a price until the time of loading, which would be around three weeks time.
Despite losses in the crude oil markets, a trader of Group III base oils believed there was still some upward price pressure in market.
“Prices are stable, but the pressure to increase is still there. Market length is gone, and producers are no longer competing for market share like a few months ago,” it said.
The trader expects to see prices increase in October.
ICIS Group III 4 cSt is valued at €935-950/tonne ($1,247-1,267/tonne) FCA (free carrier) ARA (Amsterdam-Rotterdam-Antwerp), with 6 cSt at €945-960/tonne.
Group III 4cst and 6cst truck prices have held firm in recent months because of high gasoline, fuel and naphtha values, all of which as heavily linked to crude oil price developments.
However, prices are considerably lower year-on-year when 4 cSt was valued at €1,210-1,230/tonne and 6 cSt at €1,215-1,235/tonne.
The main use for base oils is in the manufacture of lubricants, of which there are thousands of types. The best known are automotive lubricants.
Group III base oils are a higher-quality lubricant and severely hydrocracked in order to achieve purer base oil.
($1 = €0.75)
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