“Margins for conventional refiners and re-refiners fell from March to April, as both types of refiners experienced slight increases in feedstock prices over the past month,” noted Ian Moncrieff, Vice President of Kline’s Energy Practice. “Furthermore, with Brent crude slowly firming from its January lows, cycling in the low $60s per barrel range over the past month, lagged margins are approximately equal to their un-lagged counterparts from two-months ago. It appears as though base oil producers have been able to limit further discounts to postings, due to the slow firming of feedstock prices. However, indicative of the oversupply of light neutrals, Motiva announced a reduction of 18 cents/gallon in its N110 posting on June 5, while the heavy N600 grade was raised by 18 cents/gallon.”
For more information on the Kline Index, or to inquire about our pricing and margin analysis services to the base stocks industry, please contact Ian Moncrieff, Vice President (Ian.Moncrieff@klinegroup.com) at (973)-615-3680 in Kline’s Energy Consulting Practice.