There are some anomalies however, with a number of buyers searching the markets for any opportunistic year-end discounted parcels that may be available. This is not just for large cargo-sized lots but also for smaller quantities that may be offered at discounted prices to move product before the calendar turns.

Suffice to say there are not many responses to these approaches, but without any other activities to pursue, some sources have said they are making good use use of time at this time of year.

A couple of contacts have reported offers for some API Group I barrels which have been accepted for delivery before Jan. 1, and apparently the pricing attached to these offers has been attractive to buyers looking for a last-minute bargain.

There are no reported deals for supplies of Group II, and certainly not for Group III grades, but there is still time for events to unfold over the next week or so.

Europe still report surplus Group I stocks available, but with various sources have varying availabilities the market is not coordinated enough for export cargoes to be considered. For example, a supplier in the Mediterranean has excess quantities of light neutrals, whilst another seller in NE Europe has relatively large quantities of heavy neutrals, but little or no avails of lighter grades.

This situation makes logistics impossible for traders to organise bids for export sales to locations such as Nigeria, where buyers are waking up to realising that they require quantities of material to arrive in January or February, creating an opening for European supplies to play their part.

This anomalous scenario is further compounded by the lack of bright stock around Europe, preventing the blending of heavier vis grades such as SN900.

Producers and resellers have been trying to push sales of surplus Group I grades into the local regional markets, but without a great deal of success.

As imagined from the above narrative, base oil prices are seen weaker across the Group I and Group II sectors in all regions of  European, Middle Eastern and African, again with the exception of Group III grades which appear to be firming with every cargo arrival in Europe and South Africa. Even in U.A.E., Group III prices are starting to rise on the back of higher demand for these grades. Some new Chinese production is being targeted at Middle East Gulf receivers, where prices are more attractive than local markets.

With a general shift to premium base oils in Africa and Middle East markets, forecasts are positive for 2026 for these grades to make a large impression on markets. The predictions are that these grades are not merely taking over from the Group I portfolio, but are also catering for increases in demand for blended finished lubricants being produced in Middle East Gulf and regions of the African continent such as South and East Africa.

Globally, a similar direction is being adopted in almost all markets, with a general move to higher specification premium base stocks which can reused in blending the new generation of lubricants for automotive and industrial use.

The general consensus around the European, Middle Eastern and African markets is that prices will continue to be attractive to buyers, and with fundamentals remaining softer in the form of low crude and feedstock numbers. However, base oil prices retain a premiums to distillates which continues to be an attractive outlook to refiners, even at current lower levels.

Crude and Gas Oil Prices

Crude and feedstock prices indicate softer numbers this week, with a number of respected parties putting forward forecasts for next year, postulating that there will be a massive oversupply of crude from the middle of 2026, with a huge glut of crude oils moving into 2027. OPEC+ members and Russia will increase production quotas to raise revenue from crude which is often the single source available to support a number of economies around the world.

With major consumers such as China cutting down on crude consumption, whilst taking large quantities of discounted crude from Russia, and a huge move to electrification for vehicles in that country, the signs are ominous for OPEC.

Crude prices have dipped during the last seven days and may weaken further over the next few weeks. Low-sulfur gas oil dropped more than $40 per metric ton the past week.

Crude and gas oil prices are as follows:
Dated deliveries of Brent crude: $60.75/bbl, February front month
West Texas Intermediate: $57.00/bbl, January front month
European low-sulfur gas oil: $624/t, January front month

Source: London ICE late, Monday Dec. 15

Europe

Stocks remain higher than sellers would ideally prefer, but with dull regional demand and virtually no chances to move surplus material to export, sellers are looking to make short-term sales to regular buyers to limit year-end exposure to tax liabilities.

Heavy discounts have been heard in some instances from suppliers in the Mediterranean and also in Northern Europe, but with limited success in moving large swathes of material on prompt basis.

The sad truth is apparent, that demand is severely lacking, and moving forwards into January and 2026, does not appear to hold a great deal of hope for Group I markets to pick up.

Turkish import base oil markets remain quiet, with no single grade offers being taken up for quantities of SN150 and SN500/600. Shipping available quantities is also seen as a problem with smaller parcels having higher freight rates, even for short sea trade traffic.

FOB levels required to meet buyer expectations would be under raw material costs, hence, unacceptable to sellers.

December European prices remain soft, with prices offered in wide ranges. One Spanish seller appears to be pushing numbers at higher levels, quite why this is the case remains unknown.

Bright stock remains relatively tight, with this grade maintaining a large premium over solvent neutrals.

Many blenders will be closing down at the end of this week and will not reopen until Jan. 5. Those approached commented that with demand down for finished lubes, it was prudent and economical to close units, and perform maintenance where necessary over the holiday time.

Prices for solvent neutral grades are unchanged this week.

Group I

Exports from Europe, FOB (based on offers; no deals reported)
SN150: $635/t-$675/t
SN500: $700/t-$725/t
Bright stock 150: $1,155/t-$1,195/t

Northwestern Europe, FCA Antwerp-Rotterdam-Amsterdam
SN150: $785/t-$810/t
SN500: $865/t-$900/t
Bright stock 150: $1,275/t-$1,325/t

Eastern Europe,  FCA
SN150: €773/t
SN500: €825/t
Bright stock: €1134/t

Mediterranean prices, FCA (based on one supplier)
SN150: $835/t
SN600: $950/t
Bright stock: $1420/t

Pan-European, FOB/FCA, unchanged
SN150: €625/t-€675/t
SN500/600: €700/t-€745/t
Bright stock 150: €1,085/t-€1,120/t

Pan-European prices are assessed on an aggregate basis from levels in Scandinavia, Poland, France, Germany, Benelux, Spain, Italy, Greece and the United Kingdom

The euro’s exchange rate with the U.S. dollar was $1.17653 Monday.

Group II prices around Europe are weaker, but are still seen as attractive to domestic producers and importers, with large cargoes on the high seas coming into northwestern Europe from U.S. The Group II market in Europe is about to become more attractive for Importers from sources where there is no FTA in place, the prime example being U.S.

The news on the street is that towards the end of January the import duty of 3.7% will no longer apply to European Union imports of Group II base oils and whilst this has not been applied of late due to the quota system being suspended, the duty remained on the EU statute book and was always a threat to importers from the U.S. and other sources where no FTA was in place.

This decision from Brussels levels the playing field for all sellers of Group II base stocks, but will be frowned upon by domestic producers who had retained a significant advantage on margins when the duty element was in force.

Buyers are aware of the duty move and this has fuelled even more discussion on prices with domestic producers of these grades.

There is evidence that some sellers have initiated price renewals for future business with effect from January, bringing Group II prices down to more manageable and acceptable levels for buyers.

Demand for Group II base oils has slowed towards the year-end, but calls are that January and February could see a resurgence with demand for finished lubricants picking up during the Spring.

Prices are unchanged the past week.

Group II, FCA basis

110N: €845/t-€865/t
150N: €855- €885/t
220N: €875/t-€895/t
600N: €965/t-€1,010/t

These prices apply to a wide range of Group II base oils that can be sourced from within Europe, the U.S., the Red Sea and Asia-Pacific. Ranges refer to bulk shipments. Smaller quantities are being imported in flexies.

Group III base oils around Europe are the oddball in the base oil slate, with demand holding firm with positive sentiment being talked for the New Year, and distributors having allocated available barrels to customers on a fair and equitable basis.

Prices are starting firm a little, with little resistance from buyers in paying a premium to current levels for future sales. The 4 centiStoke grade remains tight, due to high demand for this grade, but distributors have commented that they cannot access larger quantities of this grade, without lifting quantities of 6 cSt and 8 cSt viscosities in the same cargo. There is some flexibility, but taking a cargo only of one grade is not possible under the agreements negotiated with producers.

Cargoes continue to arrive, replenishing stocks and maintaining supplies to an Increasing market.

Increasing production will be a key for the European Group III market, and with more competition entering the scene with additional barrels to come from Saudi Arabia in the next few years, and with two majors in the U.S.G. announcing plans to produce Group III base oils in addition to established Group II base stocks.

Domestic European production of Group III base oils will be dramatically increased from the Shell refinery conversion at Wesseling, Germany, adding to the output already established from Cartagena in Spain.

It is anticipated that new production will be aimed at the European market, although there will be discretionary options to export surplus material to markets such as African regions.

Group III prices in respect of partly-approved material, FCA Antwerp-Rotterdam-Amsterdam and Northwestern Europe remain unchanged, but the mood for distributors to gently lift numbers following the arrival new imports from Middle East Gulf and AsiaPac. Prices for grades with full slates of approvals, priced on an FCA basis from hubs in Antwerp-Rotterdam-Amsterdam, Northwestern Europe and Spain are also unchanged.

Group III

Partially approved
4 cSt: €1,165/t-€1,190/t
6 cSt: €1,135/t-€1,155/t
8 cSt: €1,125/t-€1,145/t

There have been reported numbers offered on the basis of linked pricing, which equates to around €85/t below the above levels for each grade.

Fullly approved
4 cSt: €1,610/t-€1,625/t
6 cSt: €1,595/t-€1,620/t
8 cSt: €1,585/t-€1,610/t

All the above products sold on a delivered basis are subject to transportation costs, which will be added to the prices above.

Prices for rerefined Group III, FCA Germany
4 cSt:  €990/t
5cst : €990/t
6 cSt: €1050/t

Baltic Sea

Another week passes without substantiated information regarding Russian exports. There has been no mention of export prices or cargoes loading out of the Baltic.

No vessels are identified from shipping reports as being chartered by Russian companies to export base oils to the usual location such as Turkey, and West Africa.

Also large cargoes loaded for receivers in Singapore, but these 12,000 tons parcels are missing from the radar, and do not appear to have occurred for some months.

There are currently no Russian offers for Nigeria, and no material moving into Gebze, Turkey, in Turkey. The assumption is that Russian refineries which are operating, are directing supplies to the domestic or internal users who are dependent on these supplies. There are reports of Russian prices fluctuating in the domestic market, but again these are unproven, historical and unreliable.

Ukrainian drone strikes on a number of Russian refineries and storage terminals appear to have affected availabilities of base oils.

With no new information, notional levels remain as previous :

Group I exports from Russia, FOB St. Petersburg/Vyborg (notional)
SN150: $625/t-$655/t
SN500: $660/t-$685/t.

Black Sea & Turkey

No Russian base oil has entered the Turkish market, and local reports are that storage tanks which housed stocks of Russian base oils have been re-allocated to store either other base oils such as Uzbek, Iranian or Saudi Arabian.

Inquiring in the Turkish markets, this report was told that no Russian supplies would be forthcoming in the near future, if at all. One trader commented that they had heard of a Bashneft cargo coming into Gebze, Turkey,, understandably from Ufa refinery. This seems improbable since that refinery was hit badly by Ukrainian drones, suffering major damage.

U.S. sanctions on Lukoil and Rosneft may have implications for base oil movements. It has been noted that Lukoil companies outwith Russia, in Europe for example, are being sold off.

Calls and emails to Litasco in Geneva go unanswered, suggesting that either the company has closed the office, or has put a ban on all external calls. This report will again contact Swiss sources to try to clarify the position. Litasco is or was a wholly owned subsidiary of Lukoil, responsible for trading cargoes of petroleum products worldwide, including base oils.

There appears to be very little point in giving historical Rosneft or Lukoil prices for the Turkish market.

Having applied a cut in prices a month ago, Tupras thereafter increased prices.

Group I, Tupras, ex rack Izmir refinery
Spindle oil: Tl 32,090.00/t plus VAT Tl 8,315.44/t
SN150: Tl 27,764.00/t plus VAT Tl 7,450.24/t
SN500: Tl 34,443.00/t plus VAT Tl 8,786.04/t
Bright stock: Tl 51,258.00/t plus VAT Tl 12,149.04/t

Sales incur a standard loading charge of Tl 9,487.20/t.

Group II, ex-works from Turkish traders
110N and 220N: no current availabilities
350N: no offers
150N, ex Taiwan or Saudi Arabia: $995/t
500N/600N, ex Taiwan or Saudi Arabia: $1,200/t

Group III

Parly approved Tatneft 4 cSt FCA: €918/t
Fully-approved from Spain, CIF Gemlik: €1,695/t-€1,725/t.

Middle East

The turnaround at the Luberef refinery in Yanbu appears to be on schedule with another couple of weeks to run. The maintenance is due to complete around the end of December.

Luberef also announced a feedstock supply agreement for both of its refineries, including its Jeddah facility, which had been scheduled to close next year. The agreement means Jeddah will continue producing two grades of Group I base oil, SN150, and SN500. Bright stock has not been produced at Jeddah refinery for a number years.

These grades will be available for in-house and domestic supplies in addition to export cargoes to the West Coast of India, the United Arab Emirates and Pakistan.

Middle East Gulf

Group I and Group II base oil cargoes are scheduled to arrive during the first week of January, discharging into Fujairah and Hamriyah, with a further cargo from U.S. Gulf Coast believed to be Group II base oil, which will discharge in Jebel Ali, according to local shipping agents.

Cargoes are also coming into Hamriyah from Rayong, Thailand prior to the year-end, along with a large parcel of Group II grades which loaded out of Ulsan, South Korea, bound for receivers in Hamriyah port.

Apparently there are still problems berthing at Hamriyah, with local sources saying that delays up to a week are possible for bulk liquid cargoes. This is not limited to base oils, with other petroleum products and chems arriving into this port. One source mentioned that the port authority prioritises container and dry cargo traffic over bulk liquid carrying vessels, leading to delays and demurrage.

Two European traders were looking at possible export cargoes from European sources to U.A.E., but economics are weighed against the voyage due to high freight rates and longer voyage times around the Cape of Good Hope.

FOB prices Europe would have had to be very low, possibly below cost to make such a voyage work. Also it is doubtful is any European producer would have sufficient quantities of Group I grades to build a cargo quantity.

An Indian trader has advised that an Iranian base oil cargo moved from Bandar-e Emam Khomeyni to Haldia. The cargo was 4,500 tons, consisting of premium SN500 from Sepahan Oil.

Sources in the UAE and India maintain that Iranian Group I base oils are being transported by road, transiting Iraq and finally delivering into Syria and Eastern Turkey.

Iran’s domestic Group II production is distributed only domestically within Iran and does not form any export trades. Imported Group II and Group III base oils are also moving into Iranian ports through traders based in U.A.E. and India, with the  deals are transacted through UAE banks in U.S. dollars. Sources for these supplies can be from resellers in India, who have taken cargoes from Korea.

Russian cargoes are no longer a feature of the UAE seascape, with no reported Lukoil cargoes sailing from Limas terminal in Turkey.

This report continues to try to establish what is occurring with blenders who previously used Russian base oils, but so far has come up against a brick wall, with those known to have been importing and using Russian base oils unwilling to discuss details.

Imported prices into the UAE will remain unchanged until the arrival of the new cargoes from U.S. Gulf Coast, after which there may be some revisions.

Group I, CIF/CFR UAE ports
SN150: $885/t-$920/t
SN500: $940/t-$965/t
Bright stock: $1,220/t-$1,245/t

Group I cargoes are being purchased from traders based in the U.S. and in Switzerland, but also directly from producers in Thailand, most of whom have representation in the UAE.

Group II, FCA or RTW, UAE and Oman, unchanged
110N, 150N and 220N: $1,285/t-$1,325/t
600N: $1,395/t-$1,420/t

Group II base oils are imported into U.A.E. from a number of  sources, Red Sea, U.S., South Korea and Singapore, and are being resold FCA UAE or on a truck-delivered basis throughout the UAE and Oman. Deliveries are made through UAE distributors who can purchase base oils directly from Luberef in Saudi Arabia, and also from U.S. and Far East majors and traders. The high ends of the ranges refer to material being delivered by RTW in the UAE and into northern Oman.

Group III, FCA Hamriyah or RTW UAE and Oman, unchanged
4 cSt: $1,225/t
6 cSt: $1,235/t
8 cSt: $1,255/t

The ranges of Group III prices above include a reseller margin of around $90/t covering storage, handling, insurance and a margin. RTW deliveries from distributors can incur a further charge of between $20/t-$55/t, depending on delivery location and quantity.

Middle East Gulf Group III base oils produced in Al Ruwais, UAE, and Sitra, Bahrain, and are invariably delivered by sea into Hamriyah, Sharjah port and Jebel Ali, UAE.

Netbacks for Group III base oils loaded ex Sitra and Al Ruwais for distributor sales in Europe, U.S., India and China are increased slightly due to rising selling prices, and are now assessed between $1,065/t-$1,085/t for 4, 6 and 8 cSt grades.

Netbacks for gas-to-liquids Group III+ ex Ras Laffan in Qatar, remain between $1,085/t-$1,100/t. Levels are indications only since there are no distributors involved, and the product is mainly retained by Shell affiliates for in-house blending. Middle East Gulf Group III netbacks are assessed using selling prices in known markets minus estimated marketing costs, margins, handling, storage and freight.

Africa

Availabilities from Spain remain in tank, at least until last Friday, but may still be offered to receivers in Mohammedia in Morocco, since this facility will be looking for a supply of Group I base oils, with all three grades, SN150, SN500/600 and bright stock. With this supplier not having the full slate of grades, there may be problems, and in addition if the producers is looking to sell at the high prices notified, then the Moroccans may look for other options.

The further large base oil cargo has loaded out of Rotterdam and Fawley for Durban in South Africa. it was anticipated that the further cargo of around 19,000 tons of all types of base oil would load before year end for South Africa, with the first vessel diverting to Singapore, although from reports the cargo was not the same as the usual split for Durban, and the cargo may have been specifically loaded for Singapore.

With no offers for cargoes of Russian base oils to move into Nigeria, the market is being coaxed and cajoled to look at alternative supplies with realistic prices which cannot be compared to historical Russian export levels.

Traders are finding this tough to get receivers to change tack and accept that they cannot buy material at crazy low numbers, but with one blessing, that being that sellers along the U.S. Gulf and Atlantic coasts have been keen to move surplus barrels of Group I base oils and have been more than helpful with FOB prices.

But at the moment there are few avails out of the U.S. and European numbers and availabilities do not work for Nigeria. Availabilities from Europe are not available for a sizeable cargo of Group I base oils.

One cargo which has discharged was 10,000 tons purchased by a European trader from P66 ex USG. This cargo completed discharge during November. There may be scope to repeat this exercise, but right now indications are that barrels are not available in the right quantities.

Another cargo loaded from PBF ex Paulsboro, with another 10,000-ton parcel of SN150, SN500 and SN900. This cargo was supplied at very low prices by a European registered trader. These prices served very little purpose other than to drag the market down to levels with which others are unable, or unwilling to compete.

The peak season in Nigeria is approaching with reports are that importers are now becoming concerned regarding building stocks but continue to request/demand lower prices in purchasing cargoes of Group I base oils.

Bid numbers from buyers remain at $825/t for SN150, $925/t for SN500 and $1,030/t for SN900, on the basis CFR Apapa.

The black market exchange rate for the Nigerian naira was NGN 1,451 to the dollar Monday.

Group I, CFR Apapa

Russian origin (currently unavailable)
SN150: $825/t
SN500: $895/t
SN900: $985/t

U.S. origin
SN150: $840/t
SN500: $930/t
SN900:$1,060/t

Ray Masson is director of Pumacrown Ltd., a trader and broker of petroleum products in London, U.K. Contact him directly at pumacrown@email.com.

Lubes’n’Greases shall not be liable for commercial decisions based on the contents of this report.

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