INSIGHT
Samantha Wright, Senior Editor Manager
Base Oil Report
Europe European Group I base oils spot valued were steady in mid-September, with a build-up of stocks over the summer capping buying interest. Group II base oils 150N inched down, catching up with similar losses seen last week for other grades. Arbitrage opportunities from Asia improved due to lower freight costs and a weaker US dollar. Group III spot prices were stable with availability still tight and demand seeing a slight uptick. European Group I export values were unchanged amid limited activity and continued low volumes for heavier grades.
US
Despite pockets of tighter availability, the US market was generally lengthening, putting downward pressure on prices. An uptick in customers looking for additional volumes in the wake of a downstream outage had not translated into higher spot prices. Delays in permit renewals slowed the movement of base oils into Mexico.
Asia Group I market sentiment remained pressured by improving supply from southeast Asia and additional volumes from northeast Asia. Brightstock bulk availability improved. In India, Group I supply and demand were broadly balanced, though availability from Iran, China and the US contributed to regional supply length. Group II markets were largely subdued on limited talks. While light-grade markets were holding steady amid unchanged fundamentals, supply length in heavy-grade material continued to perpetuate soft sentiments. Market feedback highlighted still-limited northeast Asia-origin light-grade supply against ready availability of heavy-grade material. While some market players had concluded the bulk of their October-loading shipments, segments of the market were still engaged in ongoing negotiations. In India, October-loading discussions were subdued, with buyers cautious as the ongoing monsoon season dampened willingness to
commit or to accumulate inventory. Group III markets were thin amid limited talks for South Korea-origin cargoes. A South Korea refiner remained tight on spot and term availability of 4cSt and 8cSt, while demand for Group III base oils was muted in China and India.
Middle East Group I markets were buoyant on supply constraints amid vessel shortages. US sanctions on vessels involved in the Iranian petroleum trade continued to perpetuate vessel shortages between Iran and UAE. As a result, the supply of low viscosity index (VI) material remained limited. Group II markets were muted on thin discussions and weak buying interest. Delays eased as multiple NE-Asia-origin cargoes previously under demurrage were discharged. However, port congestion remained an issue. Supply of NE-Asia- origin 150N base oils remained limited, compared to the length in heavy grade 500N/600N availability. Offers for 150N base oils edged higher on limited availability, although price acceptance remains limited. On the other hand, demand remained soft, with buyers covered by incoming arrivals. Group III prices saw gains on the back of tight supply in the UAE.
icis.com
LUBE MAGAZINE NO.189 OCTOBER 2025
69
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