In August 2024, Mineral Turpentine Oil (MTO) prices in the Indian market increased by approximately 3 percent, despite a 6 percent drop in feedstock Crude Oil prices. The rise in MTO prices occurred amid seasonally unfavourable conditions due to the ongoing monsoon. Nonetheless, robust consumption and continued exports of petroleum products have kept the market bullish, according to data from the Petroleum Planning and Analysis Cell (PPAC).

The PPAC's data revealed a 4.8 percent increase in the consumption of Petroleum Products, including MTO, reaching 80.9 million metric tons (MMT) from April to July 2024, compared to 77.2 MMT in the previous period. Specifically, for MTO, consumption grew by 7.4 percent, totalling 19.7 MMT, which contributed to a largely positive market scenario for MTO.

While August 2024 data from PPAC is yet to be released, Indian suppliers reported low MTO inventory levels. This shortage is attributed to the festive season's demand for replenishment and the current maintenance turnaround of refineries in India, which is expected to peak in September. Additionally, the bullish market condition for MTO is influenced by reduced production, as India's crude oil imports from Russia—the largest source of oil for New Delhi—decreased sequentially in August from near-record levels in July. Russian oil imports fell by 14.5 percent, or 0.31 million barrels per day (bpd), to 1.80 million bpd, although this still represented 39.9 percent of India's total crude oil imports for the month. Overall, India's oil imports also declined by a similar volume, down by 0.32 million bpd to 4.52 million bpd.

Despite the favourable market conditions in India, export conditions were less favourable. Exports of Petroleum products, including MTO, decreased by 4.3 percent during this period due to reduced demand from the downstream paints and coatings industries, particularly impacting exports to North American and European markets.

In the US, data from the Census Bureau of the Commerce Department indicated a 0.3 percent decline in construction spending in July, following a stagnant June. The decrease was attributed to higher mortgage rates and increased supply affecting single-family homebuilding. Year-on-year, construction spending increased by 6.7 percent in July. Investment in residential construction fell by 0.4 percent, with new single-family construction projects plummeting by 1.9 percent. A surge in mortgage rates during the spring led to an overhang in inventory, which eased pressure on the downstream paints and coatings industries and subsequently affected MTO demand. In Europe, a similar downturn in the construction sector also contributed to lower MTO orders.