US wax market concerned about changing base oil slates

15 November 2013 19:23  [Source: ICIS news]

HOUSTON (ICIS)--The changing base oil slates heading into 2014 have many in the market concerned, said participants at the week’s American Fuel & Petrochemicals Manufacturers (AFPM) Lubricants and Waxes conference.

The changes in the slates that are fostering these concerns centre around increasing Group II base oil dominance in the US.

Group II base oils are produced via a hydroprocessing technology that does not produce waxes.

Group I base oils are produced via a solvent process that produces waxes alongside the base oils.

As such, Group I base oil production is presently the only production source for paraffinic waxes.

Group II base oils now comprise about 57% of the US market and will continue to push Group I’s position as the main base oil tier with the expected Q1 2014 output from Chevron’s Pascagoula Base Oil Plant (PBOP).

PBOP will add 25,000 bbl/day of premium Group II base oil production into the commercial market – with no wax production involved.

Wax market participants at the conference stressed that it is increasingly necessary to look at how the changing base oil production slates will affect the wax market going forward.

The AFPM Lubricants & Waxes conference ends on Friday.

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By: Judith Taylor
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