Singapore producer cuts base oil prices
A Singapore-based base oil producer has cut its ex-tank prices for its Group I and Group II base oils. The price cut is its second for its heavy-neutral base oils and bright stock in less than a month.
The producer is cutting its ex-tank Singapore price for its Group I SN 600 by $30 and by $35/t for its bright stock. It is cutting the price of its Group II N150 by $15/t and by $20/t for its N500. The new prices are effective from 9 August.
The producer had kept steady its Group I SN 150 price since the end of June.
Following the price adjustment, the producer's bright stock premium to its Group I SN 150 will fall to $95/t, the narrowest in at least eight years. Its Group I SN 150 discount to Group II N150 will narrow to $10/t. The discount is the narrowest since last year. The premium of its Group II N500 to Group I SN 600 will rise to its widest since February 2017.
The price cuts follow a sustained drop in regional base oil prices because of persistent surplus supplies and weak demand. The depreciation of China's currency versus the US dollar has exacerbated the slowdown by deterring buyers from replenishing stocks. Producers have sought to move supplies to other markets instead to ease the regional overhang.