US base oil prices rise on fundamentals

07 April 2014 21:29 Source:ICIS News

HOUSTON (ICIS)--US base oil prices are up on fundamentals, as Calumet Specialty Products’s announcement that it will raise its Group I paraffinic prices by 10 cents/gal effective 8 April completes a round of March/April increases, sources said on Monday.

Ample base oil supply is said to be narrowing on refinery turnarounds and buyers re-entering the market ahead of the upcoming late spring traditional upward bounce in demand fostered by the onset of the heavy US driving season.

Group II producer Chevron’s 5 March increase announcement raising posted prices by 25-30 cents/gal, depending on the viscosity, sparked the round of March/April price moves.

Group II producers Motiva and Phillips 66 moved posted prices up by 8-20 cents/gal, depending on the supplier and the base stock grade, effective 26 March.

Calumet raised prices on its Group II base stocks by 10-20 cents/gal, depending upon the viscosity grade, effective 31 March.

Group II supplier Flint Hills Resources (FHR) announced posted price increases of 10-18 cents/gal, depending on the base oil grade, effective 28 March.

Calumet’s Group I announcement is the last of the Group I price moves, as ExxonMobil, HollyFrontier and Paulsboro Refining Company (PRC) announced price increases in that tier on 1 April, 2 April and 4 April, respectively, and with amounts varying by supplier and oil grade.

Posted price announcements were also made by producers in Group II+ and Group III tiers, ranging 14-20 cents/gal depending on grade and supplier.

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By Judith Taylor