20 November 2013 18:46 [Source: ICIS news]
HOUSTON (ICIS)--US base oil prices are falling on seasonally soft demand and sidelined buyer interest, buyers and sellers said on Wednesday.
Buyers see current base oil supply in most grades as readily available, while demand is at a lull.
“Buyers will be de-stocking their own inventory in November and December, but they will come back into the market in January,” one base oil supplier said this week.
Supply availability is fostering more domestic spot business, sources said.
“There is no question that November demand is soft,” a base oil producer said.
But US base oil demand generally slows down during the fourth quarter as refiners work to lower inventories because of year-end tax considerations.
Market sources said that refinery stocks are now largely relieved, but the year-end de-stocking mode is ongoing in the buyers’ sector.
“There are always more [base oils] available at this time of the year,” another seller commented.
“This is just normal and about the same as we saw at this time last year,” the source added.
Group I spot solvent neutral (SN) base stocks were assessed by ICIS at $3.08-3.15/gal (€0.60/litre), losing 6 cents off the low end of the spread.
Group I SN 600/650 grades fell sharply this week, dropping by 22 cents across the spread to range at $3.37-3.47/gal.
Brightstock lost 10 cents off the spread to range at $3.95-4.15/gal.
All spreads are on an FOB (free onboard) US Gulf basis.
Follow Judith on Twitter
($1 = €0.74)
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections