Base Oil, Lubricants and caustic soda Prices Moving Further

Since January, the oil price has reached about $79. The reasons for the increase are as follows:

• Every year, the market faces the new year holidays with a lower volume of trades that can change the price for a while
• Oil demand expectations have risen for the new year.
• OPEC has still stuck with the decision to increase production by 400,000 barrels in February despite the rising covid cases.
• Omicron continues to complicate market conditions. Some countries have increased lockdowns and restrictions due to the rapid outbreak of the virus.
• India reported one million infections of Omicron overnight. However, the lower risk and lower mortality of the variant have not caused serious health problems.

The above has led to an increase in market turmoil. Traders have become indecisive about buying and selling.

Although there were rumours of an increase in shipping costs for the new GRI in January, no change happened in shipping costs yet. However, people are still talking about an increase. It seems that after 6 months of chaotic transportation and shipping, we will have a calm January.

Moreover, companies might be able to fulfill many of their overdue obligations in this one month.

Since mid-December, when the covid outbreak became more serious and shipping conditions became more volatile, demand and oil prices plummeted.

Despite the high factors, the prices of lube cut products, such as base oil and recycled oil, declined in late 2021. It seems that the increase in oil prices might stimulate the demand in the new year and prices experience an uptrend again.

Currently, suppliers and manufacturers offer different prices in the market. With the recent market events, traders seem to be used to the high price trend again.

After the increase in caustic soda consumption, the market underwent a $30 growth of the FOB price of Bandar Abbas last week.

The price of paraffin wax is still above $1,000. FOB prices are currently around $ 1,250, which seems to have been relatively stable compared to last month.

Generally, the market looks to be reviving. As the January holidays are over and oil prices rise, suppliers and producers expect higher demand. Buyers who have been waiting for lower prices and better offers from market suppliers in recent months are now looking to buy at more reasonable prices than before. We expect a further increase in prices if the conditions remain as they are.

This article was prepared by Tina Taghavi, the account manager of infinity galaxy. (www.InfinityGalaxy.Org)