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Editor Heather McGuire Doyle, heather.doyle@icis.com
NOTE: For full details on the criteria ICIS pricing uses in making these price assessments visit www.icispricing.com and click on “methodology”.
Group I:
ExxonMobil, 14 January
100: +25
150: +12
300/350: +20
600: +25
BS: +25
Holly, 19 January
70: +25
100: +25
150: +25
250: +25
500: +35
BS: +35
Valero, 19 January
100: +25
150: +12
500: +25
700: +30
BS: +25
Calumet, 15 January
700: +30
BS: +25
Group II:
ConocoPhillips, 14 January
70: +25
75/80: +25
100/120: +27
200/220: +20
600: +30
Chevron, 14 January
100/120: +25
200/220: +20
600: +35
Motiva, 11 January
70: +25
100/120: +25
200/220: +20
600: +30
Calumet, 15 January
75/80: +15
100/120: +25
145/150: +25
300/350: +20
Flint Hills Resources, 12 January
70: +11
75: +11
100/120: +25
200/220: +20
600: +25
Group II+:
ExxonMobil, 14 January
110/130: +5
190: n/c
Motiva, 11 January
110/130: +10
SK Lubricants, 19 January
YUBASE 3: 15
ConocoPhillips, 14 January
50/60 (Ultra-S2): +25
70/80 (Ultra-S3): +25
Group III:
SK Lubricants, 19 January
All YUBASE: +5
ConocoPhillips, 14 January
4cSt (Ultra-S4): +5
8cSt (Ultra-S8): +5
Group III+:
SK Lubricants, 19 January
All YUBASE: +5
South America:
PDVSA, 8 February
85: +25
100: +25
150: +3
300/350: +20
500/550: +15
BS: +23
NOTE (1): Exxon posted prices were not obtained directly from ExxonMobil, but from other industry sources. Also, a 2 cent/gal discount is applicable for waterborne.
PARAFFINIC
Although buyers expressed a somewhat larger appetite for base oils during the first week of March, buyers and sellers were far apart on price ideas.
US and Mexico buyers continued to seek heavy grades, but Group I supply was limited amid reduced production, players said.
With several plants in turnarounds during the first quarter and refining margins still poor, base oil sellers were seeking higher prices in the spot market for both domestic and export deliveries. Higher crude and vacuum gas oil (VGO) prices over the last few weeks also pushed producers to quote higher price ideas.
A buyer said demand had not been strong enough during the first two months of 2010 for supply to be as tight as producers have described. The buyer said workable numbers for spot should be at least 15% below current postings.
Meanwhile, domestic railcars of light viscosity Group I base oils traded within ICIS spot ranges of $2.34-2.41/gal FOB or right around 6-10% below ExxonMobil’s posted range for SN150.
However, heavy neutrals were offered at posted levels with little-to-no discounts, players said. At least two Group I sellers said they could not even offer bright stock into the spot market as they were struggling to meet contract commitments.
Group II export spot prices held firm and were within the mid range of ICIS spot assessments, sources said.
Export prices were being challenged in India however. Indian base oils market players said they were dismayed by the unexpected hike of import duty on base oils to 10% from 5% in the country's budget announced last week.
India - a large base oil buyer in Asia - imported nearly 1m tonnes of the product in 2009. Buyers would now look for lower import base oils prices due to the hike in import duty on base oils, although it was too early to predict the impact on the import market.
Upstream, NYMEX crude responded to a weaker dollar and to a healthy rally in gasoline, surging to $80.95/bbl before retreating.
US refinery utilization rates increased to 81% this week, and were now back within the 5-year average operating rate for this time of year.
| Feedstocks | 2 March 2010 | 23 February 2010 |
| Low Sulphur Vacuum Gas Oil | WTI +$8.50 or $2.10-2.11/gal | WTI +$9.00 or $2.09-2.10/gal |
| High Sulphur Vacuum Gas Oil | WTI +$6.50 or $2.05-2.06/gal | WTI +$7.00 or $2.04-2.05/gal |
| West Texas Intermediate (WTI) crude | $79.68/bbl or $1.90/gal | $78.86/bbl or $1.88/gal |
| Natural Gas | $4.708/MMBtu | $4.778/MMBtu |
| Fuel Oil | $70.25/bbl or $1.67/gal | $71.25/bbl or $1.70/gal |
| No.2 Low Sulphur Diesel | $207.25-207.50 cents/gal USG | $204.50-204.75 cents/gal USG |
NAPHTHENIC
Caribbean Posted Prices, effective 16 November
60: +15
100: +15
750: +20
2000: +10
As naphthenic base oil sellers began to return to production following a season of turnarounds, competitive prices were offered into the US spot market.
Domestic railcars of mid-viscosity oil were trading at ICIS low or just slightly over in many cases. Offers at ICIS low plus 10 were turned down by buyers for the light and mid grades, sources said.
A buyer said there was plenty of light and mid viscosity material available and room to negotiate on these grades.
Sources said that heavy naphthenic grades remained snug, but the additional production back on-stream had created some lower offers for Pale 2000.
The spot price range was narrowed to reflect recent market transactions and forward discussions.
During January and February, San Joaquin Refining (SJR), Cross and Calumet had been in planned turnarounds. All had returned with the exception of Calumet’s production in Houston. The restart of Houston Refining’s 3,600 bbl/day pale oil plant would be delayed until the 8th of March.
EUROPE AND ASIA MARKET
Asia prices were stable-to-firm amid healthy demand and balanced-to-snug supply for heavier grades. Bright stock cargoes were assessed up $10-20/tonne at $900-940/tonne ($3.05-3.19/gal) FOB Asia for export.
S-Oil has shut its 23,000 bbl/day Group II+/Group III base oils refinery in Onsan, Korea for maintenance. After the turnaround, the Group III base oils production will be doubled.
Export prices were unchanged in Europe with bright stock holding at $860-900/tonne ($2.91-$3.05/gal) FOB EUR. Higher prices were quoted, but traders said they were finding it difficult to pass higher numbers through.
Exports from Baltic Sea ports remained difficult owing to thick ice at many ports. SN150 was assessed steady at $680-700/tonne ($2.24-2.30/gal) FOB EUR, while SN500 was also steady at $705-720/tonne ($2.35-240/gal) FOB EUR.
SHIPPING
FIXTURES:
n/a
ENQUIRIES:
500 tonnes NH Base Oils Zjg/H.Kong end Feb/Ely Mar
2,850-9,600 tonnes 3 gr Lubes Augusta/Jebel Ali + Sharjah 12-17 March
5,500 tonnes Base Oils Algeciras/Chittagong 5-15 March
2,500 tonnes Base Oils Livorno/Mombasa 12-15 March
4,500-5,200 tonnes Base Oils Livorno/Mumbai + Fujairah 2H March
8,000 tonnes Base Oils Theodosia/Chittagong + Singapore 1H March
4,500-5,000 tonnes Base Oils West Med/Chittagong 10-15 March
5,500 tonnes Lubes Theodosia + East Med/Singapore early March
1,900 tonnes 2 gr Base Oil Chennai/Trincomalee March dates
2,000 tonnes Base Oils Karachi/Sharjah 1-10 March
3,000 tonnes Base Oils Middle East/Singapore ppt onwards
3,000 tonnes Base Oils Sharjah/Chittagong ppt onwards
3,000 tonnes Base Oils 2G Mailiao/Shanghai pmt/2 Mar
3,000 tonnes Base Oils 2G Mailiao/Yingkou prmt/2 Mar
2,000MT Base Oils Mailiao/Port Klang 10-20/Mar
1,700 tonnes Base Oils Yokohama/Ulsan prmpt
2,000 tonnes Base Oils Yokkaichi/Ulsan prmpt
2,500 KL Base Oils Ulsan/Kobe prmpt
2/2,100 tonnes Base Oils 3G Kaohsiung/Spore 26 Feb/6 Mar
5,000 tonnes Base Oils B.Bushire or UAE/Jakarta 1W Mar
10,000 tonnes Base Oils Livorno/Tema, Mombasa, Mumbai & Fujairah mid/Mar
2,850 tonnes Lubes 3G Augusta/Jebel Ali 12-17/Mar or ely Apr if via Suez
1,300 tonnes Brightstock Mersin/Mumbai Prmt/10 Mar
This week on ICIS news ( www.icis.com ):
02-Mar-10 23:16 Methanex Chilean operations unaffected by earthquake
02-Mar-10 23:00 Investors take US Terra stock 11% higher following CF bid
02-Mar-10 22:56 US PGP keeps wide spread over RGP on splitter constraints
02-Mar-10 22:49 March US aliphatics hikes to apply only to low end of price range
02-Mar-10 22:35 Five US automakers record Feb sales gains, Toyota down
The Fourth ICIS-LOR Global Styrene Conference will be held at the Four Seasons Hotel in Singapore on the 13th& 14th December 2000. For more details contact Joanne Brown Tel: + 44 208 652 3836. E-mail
Joanne.Brown@rbi.co.uk
The 4th Asian Base Oils & Lubricants Conference
8th - 9th June 2010, Millennium Seoul Hilton Hotel, Seoul, South Korea
Visit: www.icis.com/asianbaseoils
Early Booking Discount
Book before 31st March 2010 and save $250
