06 November 2013 17:16 [Source: ICIS news]
LONDON (ICIS)--African base oils prices have held steady in line with European domestic base oils values despite low demand, sources said on Wednesday.
According to a European trader, demand in Nigeria is down by around 50% compared with usual levels for this time of the year. The trader believed this to be merely a seasonal fluctuation.
In Europe, lower base oils prices were discussed, although a number of sources said they had seen no change from October to November because refiners were already struggling with such low margins.
“In the domestic, it’s a rollover versus October. In some cases we reduced slightly. Essentially around $10/tonne [€7/tonne],” a producer said in relation to November prices.
Meanwhile, a trader of base oils in the European market had seen no change in truck prices from October to November.
“Concerning the domestic market - euro truck prices are the same as the last month - there is pressure by the buyers.
“They say we should do something because of the exchange rate. [Named producer] advised that margins are so bad they will not do anything,” the trader said.
Meanwhile, in dollar terms, base oils prices in Africa have moved down. The South African rand is at an eight-week low because of possible strike action.
Some sources said the rand could weaken further if US labour data published later this week proves stronger than expected, thus strengthening the dollar further.
African base oils prices are set against ICIS domestic base oils prices.
SN (solvent neutral) 150 ex-tank Durban is currently quoted by ICIS at South African rand (R) 12.60-13.00/kg ($1.23-1.26/kg) with SN500 quoted at R13.20-13.60/kg ex-tank Durban.
($1 = R10.24, $1 = €0.74)
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