With the price of crude moving up while the price of base oil was trending down and is now flat, it’s clear the spread between the two has increased. Traditionally, this means something has got to give. And if history repeats itself, unless the trajectory of crude prices soon changes course, it’s likely the spread will compress as a result of increases in base oil prices. And when and if that happens, it’s not long before the price of finished lubes follows.
So keep your eye on the spreads and your inventory.