Weekly Lubricant Report: A Positive Outlook for the Southeast Asian Base Oil Market

On 25th October, the WTI crude oil closed at 85.05 and the weakening of the U.S. dollar helped oil prices this week to keep WTI front-month prices at $86 per barrel.

The American Petroleum Institute (API) reported a build this week for crude oil of 4.520 million barrels. Top officials from U.S. shale companies have questioned the Biden Administration’s vow to start refilling the Strategic Petroleum Reserve when oil prices hit $67-72 per barrel, saying we are unlikely to see oil prices going that low anytime soon. 

India’s base oil demand probably held firm amid the domestic lube consumption while slower imports in recent months occurred. But generally, India’s demand for very-light grade base oils is likely to remain muted. About Singapore’s base oil market, this country’s export to southeast Asia exceeded shipments to China and India combined in September for a sixth straight month.

The trend highlighted the growing demand and importance of the southeast Asian base oils market.

Currently, the price of RC base oil FOB Bandar Abbas is 820 to 830 dollars, caustic soda flakes is 710 to 720 dollars, and paraffin wax is 1200 to 1250 dollars. 

Altogether, the recent base oil price volatility causes buyers to pause until there are more signs prices have settled out.

This article was prepared by Mozhdeh Darbandizadeh, the account manager of Infinity Galaxy (www.infinitygalaxy.org).