“Margins for conventional refiners and re-refiners fell from March to April, as both types of refiners experienced slight increases to feedstock prices over the past month,” noted Ian Moncrieff, Vice President of Kline’s Energy Practice. “Furthermore, with Brent crude hovering the $55-60 per barrel range over the past three months, 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, a potential indication of low overall inventories as the industry heads into the summer driving months. As the market evolves out of this period of tightness, it will be interesting to see if base oil producers can sustain current margins.”
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.