Unexpected Demand Growth In Base Oils and Lubricants 

Enduring tensions over Russian military reinforcements along Ukraine's borders have disrupted the supply of products and raw materials. Crude oil prices have also advanced amid concerns about a Russian invasion of Ukraine. Brent and WTI exceeded $90.

Meanwhile, the Omicron strain of COVID-19 appears to be recovering despite the availability of vaccines. Different countries are imposing restrictions on mobility and travels again.

Market activity has declined in Asian countries while celebrating the Lunar New Year or Spring Festival this week. In other countries, ambiguities over crude oil, raw material prices, and supply chain disruptions continue to influence decisions and pricing of base oils and lubricants.

Despite previous forecasts of declining demand for base oils and lubricants before the lunar New Year holiday, there was an unexpected increase in demand in the days leading up to the holiday season. Some sources said this was due to concerns about rising base oil prices in the second half of the month after the surge of crude oil and raw material prices over the past two weeks. This sudden increase in demand encouraged some suppliers to raise their prices.

Demand in the wax and paraffin market has also increased significantly in recent weeks. However, supply problems remain the same as in the last months.

Shipments to India seem to be facing new issues which will be affecting trade schedules in India. All direct shipments to Indian ports are disrupted and appear to be redirected to other ports once again.

Caustic soda Bandar Abbas FOB price has rocketed above $900 due to the surge of covid and demand.

 

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