Base oil refiners in the Middle East face a slowdown in business from China, following the outbreak of the deadly coronavirus as the crisis shreds lubricant and grease demand in key sectors.
According to Matthew Chong, senior editor at ICIS, most blending plants on mainland China remain shuttered as fears grow that the crisis in the world’s largest automotive market may not yet be fully contained.
The extent of the impact on China’s base oil imports is difficult to gauge, but consultancy Wood Mackenzie estimates the crisis will lop 250,000 barrels per day from China’s crude oil imports in the first quarter. The consultancy states that weak downstream demand could also have a major impact on the polyolefins industry.