The global market for white oil recently experienced a fall in prices due to a downturn in demand in both North America and Asia. While a two per cent fall in crude oil prices last month eased white oil production costs, supply conditions were considerably varied.
Supplies of white oil are tight in China and other Asian nations compared to the US, where stock of the cosmetic grade lubricant is abundant. A six per cent drop in demand towards the close of the financial year also prompted suppliers in North America to liquidate their inventories.
Designed to be odourless, tasteless and colourless, white oils are pure speciality oils that are used in a wide range of food safe lubricants for the manufacturing of consumable products. For instance, PARALIQ P 12 is a lubricant designed for the food processing and pharmaceutical sectors produced by Kluber that contains white oil, and is used to lubricate machinery where incidental contact may occur.
Despite constricted supply in Asia, particularly in China, global prices for white oil are expected to drop because of de-stocking activities at the end of the year, which will likely result in more ample supplies across all markets.
Delayed arrivals and an anticipated three per cent fall in freight charges will also have an impact, lowering import prices on the East Coast of the US and at ports in Southeast Asia ports.
Market analysts expect all these factors to contribute to the decline of global prices for white oil.
