Easy availability of most of the grades backed by a seasonal slowdown, together with the fears of the Delta Variant related localized restrictions in various countries has continued to exert downward pressure on the prices of Base Oil in Asia. 

The supply has been on the higher side since the past two months. It is because of this that the Asian suppliers have been looking at the USA, Latin America, and Middle East markets for export options. Buyers in the USA have been particularly interested in Group I and Group III cargoes, but port restrictions and transportation disruptions would mean that imports would be constrained keeping the regional domestic supplies higher in Asia. 

Ex-Tank Singapore prices for Grade I were down $10 per tonne at $860-$890 per tonne. And the prices for Group II decreased by $20 per tonne to $870-$910 per tonne. Upstream Crude Oil Prices decreased in the Asian markets due to deep Saudi Price cuts. 

Base oils are Crude Oil by products having application as lubricants in automotive and heavy machinery. Base oils are classified into different groups based on percentage saturation and percentage of sulphur content. 

As per ChemAnalyst, “the fall in the Base Oil Prices is expected to stabilize since the Ida related disruptions are about to create a strong demand amid low domestic supply in the USA market. The prices are expected to take an uptick in the end of the current month when the cargoes start entering the USA ports after the port related disruptions are over.”