Base oil and Caustic Soda Still Have Bright Future

We are preparing Infinity Galaxy’s base oil and lubricant market review while we are getting ready for the AME Conference in beautiful Delhi, India. Tomorrow, Infinity Galaxy stands as one of the exhibitors at the Rex fuels’ bitumen and modification bitumen conference. We are all honoured to have Shri Nitin Jairam Gadkari, Ministry of Road Transport and Highways of India, in the ceremony.

Although base oil, lubricants, and caustic soda are enjoying the opportunity of rising transportation and demand, market obstacles do not let them thrive much.

The unstable condition of crude oil was a huge burden on the market. Biden asked several countries, including India, Japan, China, and South Korea, to tame the price by releasing strategic stockpiles. The countries declared their cooperation which led to crude price fall to about $78. OPEC+ did not stay quiet and clearly stated to stand against any surplus by the countries. The opposition could raise the price to $80 at the time of preparing this report.

Analysts are uncertain about crude. Some believe that the price will decrease during December by the supply surplus in the market. Others stand strong for the rise of prices to $90.

Shipping and freight difficulties are still troubling traders. Vessels are still puzzled about the eastern ports of India, specifically Mundra. Freight has risen aggressively. Loading time has been obscure during the recent weeks; therefore, a huge number of cargoes have been stalled on the ports. Sipping lines do not have any clear solution for the current condition.

Traders are taking every step cautiously to avoid any unforeseen trouble. They are more willing to buy cargoes that have a definite time of sailing out. However, suppliers cannot determine the exact time.

Base oil and lubricants price outlook is more likely to rise as we get closer to winter. The foreseen demand of the winter season seems to take over the difficulties of the market.

Caustic soda prices seem to be falling from $900 – $950 as China has returned to the supply chain. However, China intends to supply the domestic demand before any export. Only 30% of the price increase is covered at the moment. Bandar Abbas FOB price is still in the range of $600 -$650

We recommend spot trading at the current market turmoil. It is wiser to avoid any long-term investment at the moment.