Supply of Group II base oils remain tight

China’s CNOOC started operating its Group II base oil plant in Huizhou this month, mainly producing light grade base oils, according to Base Oil Market Weekly. However, the Dutch base oil pricing service reported that many Chinese buyers are holding off, expecting that the additional volume from this refinery will ease the current supply tightness in the market which has resulted in higher prices. Meanwhile, South Korean base oil producers are set to increase May export prices by around US$80/metric ton, with the expected turnarounds of two major refiners in May and June. A major Singapore producer is also expected to increase prices for all grades of Groups I and II base oils, by as much as US$60/metric ton, on April 26. (April 25,2011)