INSIGHT
Samantha Wright, Senior Editor Manager
Base Oil Report
Europe European spot prices were stable to soft dependant on grade in mid-July. Domestic group I values slipped as market fundamentals are set to soften as local refinery maintenance comes to an end and the start of the summer holiday season approaches. Group II spot prices were unchanged with the exchange rate stimulating the eastward arbitrage. Group III prices were steady this week with the summer holiday period in Europe muting activity. European Group I export values were stable with minimal change seen in market fundamentals. Tightness persists for export brightstock, with strong demand seen in the eastern Mediterranean and northern Africa.
US
Domestic prices in the US were held steady in mid-July as spot availability remains tight following a heavier- than-normal maintenance season ahead of the Atlantic hurricane season, which lasts through October. While spot availability remains tight, especially for certain suppliers, supplies largely continue to outstrip demand, limiting upward price pressure. Contracts are well-supplied, including in export markets.
Asia
Asian spot prices were mixed in mid-July. Group I talks were limited in SE Asia and in China, but an uptick was observed in India amid reduced availability from the Middle East. In India, limited availability of low viscosity index (VI) material due to a lack of fresh cargo arrivals drove up buyer acceptance for high VI material. While loadings from Iran appear to be regular, stock replenishment will take time to arrive. Supply was further constrained by the limited availability of domestic spot material and imported Saudi-origin cargoes. Market participants also expect term allocations to be reduced in the near term. Group III prices were flat amid pockets of discussion in China for South Korean origin cargoes. With the return of SK Enmove, supply will continue to improve with discussions for July-loading shipment. 4 and 8cSt
material remains limited from South Korea, while Malaysian 6cSt material remains ample. Group III base oils demand in India remains lukewarm, although there was some interest seen for 4 and 8cSt base oils.
Middle East
In mid-July, Middle Eastern spot prices were largely steady. With the de-escalation of tension in the Middle East, the prospect of stable Group I supply dominated the market. Improved Iranian low-VI availability is expected in the weeks to come, with steady loadings from Iranian refineries. Group II discussions were in the doldrums with market participants largely covered for their supplies for July. Limited South Korean 150N availability also led sellers to focus their attention on markets with better netbacks. Meanwhile, healthy availability of 500N/600N for some refiners led to softer sentiments among refiners. Group III markets were quiet on thin talks and soft demand. Supply remains limited with BAPCO still undergoing turnaround, and limited material from South Korean refineries.
icis.com
LUBE MAGAZINE NO.188 AUGUST 2025
61
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