Hurricane Harvey devastation could impact European base oils market

30 August 2017 11:08 Source:ICIS News

LONDON (ICIS)--The impact of Hurricane Harvey on refineries in the US Gulf Coast could affect supply in the European base oils market, sources said late on Tuesday.

Europe is a net importer of GII base oils and tends to import large amounts from the US.

Players have suggested that a lack of GII base oil supply from the US could impact European market supply and even potentially bring the possibility of exporting European base oils to the US.

“In the US, production is closed due to the hurricane and I think that the market could even go up as I’m seeing demand from US customers as they can't source product elsewhere. I spoke with four to five refiners out in the US...everybody is in a panic. They have a lot of issues now with the production and I don’t see any offers until end of the year at least,” a trader said.

“[The] hurricane has affected base oil supply. Weather disruptions mean all the refineries are blocked and be it naphthenic, GI or GII [base oils] – everybody is in trouble. I think we could export to the US following the hurricane,” another trader said.

“I’m not sure on the effect of the hurricane but it could affect supply from the US,” another trader said.

By Sarah Trinder