Base oils and waxes
Overview
As the world pivots towards decarbonisation, challenges and opportunities loom for base oils production and demand. Staying on top of this market is more important than ever to realise these opportunities and mitigate pricing risk.
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Latest base oils and waxes news
Browse the latest market moving news on the global base oils and waxes market.
US Group II base oil margins rise on higher prices
US Group II base oil margins rise on higher prices
Houston, 8 May (Argus) — US Group II base oil margins over feedstocks and competing fuels rose during the week ended 3 May as spot prices continued to rise on a more balanced supply/demand situation. The Argus domestic spot US Group II N100 premium to four-week average low-sulphur vacuum gas oil (VGO) rose to $1.03/USG, up from 92¢/USG the previous week. Margins remained below year-earlier levels of $1.08/USG. The Argus domestic spot US Group II N100 premium to four-week average US Gulf coast (USGC) diesel rose to 89¢/USG, up from 79¢/USG the previous week. Margins remained below year-earlier levels of 90¢USG. Margins over VGO are at their highest since February, and margins over diesel are at their highest since January. Group II base oil spot prices have risen each of the past three weeks on rising demand and tighter supply, particularly for low-viscosity grades. Key Group II refiner Motiva is taking a partial turnaround at its 40,000 b/d Group II/III base oil unit in Port Arthur, which is affecting its low-viscosity output. Demand for base oils are also rising as blenders are seeing increasing finished lubricant consumption and are also building limited stocks to get ahead of potential higher prices in the peak summer months. Base oil margins are also being supported by declining values for feedstock and competing fuels. Supplies of VGO are increasing as imports from Europe are being discussed amid an open arbitrage. Diesel prices are also falling, to their lowest since January, on lower demand and ample supplies. By John Dietrich Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
General Petroleum expands UAE base oil storage facility
General Petroleum expands UAE base oil storage facility
Singapore, 7 May (Argus) — UAE-based lubricant producer General Petroleum plans to finish building the second phase of its UAE base oil storage terminal by the end of May, according to a source close to the firm. The construction started in March and will consist of 12 storage tanks, each with a 2,200t capacity. The producer aims to start operations at the second phase in June. Construction for a third phase is also scheduled to begin in June 2025, which will add four storage tanks of 6,000t capacity each. The first phase of the storage terminal started operations in March 2020 . That storage terminal consisted of eight storage tanks, each with a 1,550t capacity. The facility, located in the Hamriyah free zone in Sharjah, is expected to have a combined 62,800t base oil storage capacity after the phase three expansion is complete. The terminal is connected by two pipelines to the jetty. General Petroleum operates a 150,000 t/yr lubricant plant opposite the storage terminal, and exports more than a third of its production to overseas markets, the same source added. The company had highlighted North Africa, Asia-Pacific, and the Americas as key markets for growth. The blender also has a 25,000 t/yr production facility in Tanzania and a 35,000 t/yr facility in Uganda. The UAE is a major lubricant blending and trading hub in the region because of its strategic location and logistics infrastructure. The Mideast Gulf is also largely self-sufficient on base oil supply and is typically a net exporter of the lubricant feedstock, especially for Group I and Group III supplies. Regional base oil supply is set to rise in the years ahead with planned expansions. Africa is a growing market for base oils, propelled by its gross domestic product and population growth. Rising mobility needs and vehicle ownership is also expected to boost demand in the years ahead. Africa predominantly produces Group I base oils but remains structurally short on supply. Overseas supplies, including those from the Mideast Gulf, make up a sizeable portion of the region's imports. By Chng Li Li Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Spain’s base oil sales up last year, exports down
Spain’s base oil sales up last year, exports down
London, 3 May (Argus) — Spanish base oil demand edged up last year, supported by increased new car sales and competitive prices, while exports fell marginally as refinery maintenance curbed domestic output. Spanish base oil sales rose by 3pc to over 423,000t in 2023, according to data from state-owned strategic reserve Cores. A rise in new vehicle registrations in Spain supported demand for finished lubricants. Gasoline-fuelled vehicle registrations increased by 14pc last year to 387,750 units, data from the European Automobile Manufacturers Association show. Competitive spot prices supported demand. The average Argus- assessed SN 150 domestic price fell by 24pc on the year to $1022/t in 2023. Exports edged down to below 1.46mn t in 2023, according to GTT data, despite hitting a three-year high of 793,200t in the second half of the year. Refinery maintenance in the first half of the year curbed output. Exports fell to an eight-year low in the second quarter of 2023 to 249,920t, driven by a 40-day maintenance programme at the country's 630,000 t/yr Group II and III Ilboc refinery. . Maintenance at Cepsa's 250,000 t/yr San Roque base oil refinery until mid-June also weighed on export availability. Spanish base oil exports to India, France and the Netherlands dropped by a respective 16pc, 12pc and 10pc last year, offsetting a 65pc rise in exports to Egypt, which totalled 30,200t. By Christian Hotten & Gabriella Twining Spanish base oils t 2023 2022 ±% Demand 423,407 409,413 3.4 Exports 1,459,699 1,467,584 -0.5 Cores ,GTT Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Neste’s Porvoo prepares for major turnaround
Neste’s Porvoo prepares for major turnaround
London, 2 April (Argus) — Finland's Neste started preparations for scheduled maintenance at its 205,000 b/d Porvoo refinery on 1 April, with the nine-week turnaround due to start in mid-April. The current preparations include the "shutdowns of process units", Neste said. The turnaround involves shutting down the entire refinery for "statutory inspections, maintenance works and asset improvement initiatives", aiming to make Porvoo "the most sustainable refinery in Europe by 2030 and to reach carbon-neutral production by 2035", Neste said. Neste plans to convert Porvoo into a 3mn t/yr renewables facility, at a cost of €2.5bn ($2.74bn). The conversion is to be carried out in stages and to be completed in the mid-2030s. Porvoo houses a 250,000 t/yr Group III base oil unit and accounts for around 28pc of Europe's Group III nameplate capacity . Group III prices have started to rise as disruption in the Red Sea has delayed vessel arrivals and limited supply. The Porvoo turnaround will tighten spot availability further and increase Europe's reliance on delayed imports. The refinery has recently been affected by strike action since 11 March, which has since been extended twice, with the latest end date set to 7 April. The industrial action is in response to government plans for labour market reforms. The strike has impacted "stevedoring jobs" and "Viking Line's cargo handling tasks in the ports of Helsinki and Turku", the Central Organisation of Finnish Trade Unions told Argus . Fuel distribution has also been disrupted. "We are working hard to keep fuel distribution ongoing as well as possible in this difficult situation. But as we have already said, the situation is getting worse, and the fuel availability at the stations changes daily," Neste told Argus on 27 March. By Christian Hotten Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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