Base oil fundamentals in the U.S. shifted decisively higher in April as refinery disruptions tightened supply and demand for automotive and industrial lubricants improved ahead of summer driving. Early April was range-bound, but mid-month saw constrained availability as refiners prioritized distillates and producers pulled back on spot offers. Downstream buyers remained active for engine oils, greases and lubricants, leaving little slack in the system. Market participants reported allocations and cautious buying, with assessments and trading levels accelerating through month. Demand strength remained centered in automotive and transportation segments, while industrial lubricant producers maintained appetite for greases and finished-lube stocks. The April assessment for Base Oil Group II H grade rose sharply, reflecting a tighter balance and stronger downstream consumption. Valero’s Benicia refinery outage removed output, tightening domestic availability. Global premium constraints persisted, amplifying pressure on Group II. Outlook remains tilted to the upside amid thin import cover and demand, with procurement expected to stay tight into May and June.
