EMEA Weekly Base Oil Report
Base oil markets are still struggling to recover from the economic downturn caused by the COVID-19 pandemic, but prices have started to recover, particularly in the API Group I camp.
Group I production cutbacks accomplished over the past few months b have started to bite, and rising demand is exerting pressure on the supply chain. The other factor affecting demand for Group I base oils is the large price differential between Group I and Group II prices, which is acting as a deterrent against buyers moving over to Group I. This difference in pricing is narrowing as Group I levels start to rise, but there remains a massive incentive to continue using Group I grades wherever possible.