Group I 
The Group I segment has generally seen tighter supplies than Group II and prices have held for most of the year, although spot prices had come under pressure because of growing supplies against weaker demand from industrial and heavy-duty applications. Manufacturing operations have been affected by the tariff upheaval in the U.S., dampening demand for industrial oils and metalworking fluids.

However, with a U.S. producer having recently completed a turnaround at its Group I unit, spot supplies of most Group I grades were heard to have tightened. Some blenders preferred to use Group II cuts instead of Group I base oils when substitution was possible due to competitive pricing of Group II grades, but Group II spot supplies are likely to tighten due to an ongoing shutdown at a Group II plant.

It was heard that Calumet had completed maintenance at its paraffinic Group I and Group II plant in Shreveport, Louisiana, in September and was rebuilding inventories.

Suppliers have started to draw down their emergency stocks as the hurricane season is coming to an end, but Group I spot supplies were still heard to be on the snug side and most suppliers were not able to offer sizable cargoes for export after meeting contractual commitments.

U.S. shipments of Group I and Group II base oils continued to move to Mexico regularly, but persistent difficulties with import licenses and economic uncertainties had dampened business in the previous weeks. However, it appears that buying interest has improved as some buyers had depleted inventories while postponing purchases for as long as possible to achieve lower prices. They have now returned to the market to seek supplies. Many negotiations between U.S. suppliers and Mexican buyers typically take place during the fourth quarter of the year, both for contract commitments and spot supplies. 

There appeared to be growing concerns regarding Mexican tariff and customs reforms that may affect fuel and base oil imports in the future. Back in September, the Mexican government proposed tariff reforms that would expand the number of product classifications affected by new duties, potentially increasing costs for some imports. Also included in the September 2025 reform proposal are changes to customs law to tighten controls, increasing liability for customs brokers and importers. In early October, Mexico issued new rules limiting the duration of fuel market permits and eliminating renewals for most imports. While these changes are focused on the fuel market itself, they represent an overall trend of tightening government oversight of the energy sector and it was not clear what their impact on base oils might be.

Meanwhile, in Brazil, consumers had delayed negotiations in hopes of lower prices for U.S. cargoes as there were expectations that suppliers would offer attractive prices to offload their surplus inventories. Many blenders preferred to secure product from the local producer, who has kept October prices unchanged from September levels. However, downward pressure was building on Group II supplies as inventories were heard to be plentiful. On the other hand, Group I cuts were understood to have tightened due to reduced run rates at a local plant, with bright stock deemed the most affected grade and buyers looking for imports to fill the supply gap.

Group II
The mid- and heavy-viscosity Group II base oils had been exposed to downward pressure in the previous weeks given mounting spot supplies, but prices have stabilized as tighter conditions were anticipated following the start of a turnaround at Excel Paralubes’ plant in Louisiana earlier this month. 

Suppliers’ efforts to find a home for the extra barrels that they had kept during hurricane season were partly to blame for the softer conditions affecting the Group II segment. Producers often revise prices in the fourth quarter, but some expected pricing decisions to be delayed until there was a better feel regarding the effects of the Excel Paralubes turnaround.

Excel Paralubes had been running its Group II/Group III plant below capacity for most of the year and the producer shut down the unit for a scheduled maintenance program and catalyst change at the beginning of October. The unit was expected to be offline for approximately four to six weeks. Excel had begun to build inventories to cover contractual commitments during the outage and had restricted spot availability, according to sources. There was no direct producer confirmation about the plant’s operations.

Before the turnaround began, several cargoes had been offered for export business, with a number of shipments understood to have been sold to India. India typically receives large volumes of U.S. base oils during the last quarter because demand in the country picks up after the monsoon season and ahead of several religious holidays such as Diwali. Buyers take advantage of attractive prices for U.S. base oils as producers try to avoid a supply overhang. The Indian government has also implemented tax relief regulations to encourage domestic consumer spending, and the new lower taxes were expected to lead to an increase in automotive and motorcycle sales, and in turn, could boost demand for factory-fill lubricants and greases.

Group III
Plentiful supplies and sluggish demand continued to exert downward pressure on Group III base oils, but some suppliers were keeping prices largely unchanged because of a steady customer base. At the same time, a number of suppliers have granted discounts to protect or increase market share, according to sources. Importers were also facing increased freight costs as freight rates have edged up due to a more limited number of vessels covering transpacific routes.

The softer market conditions were largely attributed to sagging consumption levels from the PCMO segment as the summer driving season has ended. Demand for factory-fill lubricants has also weakened because of dampened passenger car sales in late 2025 as a result of several factors. Following a period of “panic buying” in early 2025 driven by anticipated tariffs and higher prices, car sales have started to show signs of a decline. According to TD Economics –the economics forecasting and analysis arm of TD Bank Group – while overall sales remained healthy through the end of the third quarter, a downward trend was observed in September versus the previous year, and a further slowdown is expected in the fourth quarter due to a cooling labor market and economic slowdown, the elimination of EV subsidies, high interest rates, and potential price increases from tariffs.  

A number of U.S. producers have started to produce Group III grades and while most of these volumes are used for internal lubricant production and have not affected the merchant market, it means that these producers are less likely to purchase imports. Meanwhile, regular suppliers continue to bring almost the same volumes fromCanada, the Middle East and Asia into the U.S. market every month.

In the U.S., Excel Paralubes was anticipated to shut down its Group II and Group III plant in Lake Charles for maintenance in October. However, the impact of the turnaround on the domestic market was expected to be limited as the unit produces Group III volumes for the company’s own internal consumption. Excel Paralubes does not comment on its production status. 

Naphthenics
The naphthenic side of the business was generally stable, with prices receiving support from a fairly balanced supply and demand ratio. The ongoing turnaround at Ergon’s naphthenic base oils plant in Vicksburg, Mississippi, was expected to keep spot supplies on the tight side until the program is completed in mid-October. Ergon started a comprehensive 45-day maintenance program at its refinery on Sept. 1. The producer has built inventories to ensure ratable customers are not affected by the shutdown, but there were expectations that spot supplies would remain on the tight side.

Producers were keeping a close eye on crude oil prices as they plunged the previous week. But higher diesel prices were expected to affect base oil contracts tied to a diesel index. If steeper diesel prices persist, they may also encourage refiners to stream more feedstocks into fuel production and trim naphthenic base oil output.

Crude 
Crude oil futures steadied on Tuesday after slipping on Monday on news that OPEC+ members planned to increase output again in November, contributing to global oversupply conditions. However, analysts said the intended output increase was smaller than expected, and while U.S. crude stocks rose the previous week, fuel inventories fell, according to the American Petroleum Institute.

The U.S. is set to break yet another oil production record this year, but the Energy Information Administration (EIA) says the resulting supply glut could drag prices lower in the months ahead, according to OilPrice.com.

West Texas Intermediate November 2025 futures settled on the Nymex at $61.73 per barrel on Oct. 7, down from $62.37/bbl for front-month futures on Sept. 30.
Brent futures for December 2025 delivery were trading on the ICE at $66.22/bbl on Oct. 8, up from $65.61/bbl for front-month futures on Oct. 1.
Louisiana Light Sweet crude wholesale spot prices were hovering at $64.64/bbl on Oct. 6, down from $66.57/bbl on Sep. 29, according to the U.S. Energy Information Administration.

Diesel
Low-sulfur diesel wholesale, Oct. 6 (Sep. 29), EIA
New York Harbor: $2.30 per gallon ($2.39/gal)
Gulf Coast: $2.19/gal ($2.28/gal)
Los Angeles: $2.44/gal ($2.44/gal)

Gabriela Wheeler can be reached directly at gabriela@LubesnGreases.com

LNG Publishing Co. Inc./Lubes’n’Greases shall not be liable for commercial decisions based on the contents of this report.

Posted Paraffinic Base Oil Prices

October 8, 2025

(Prices are FOB basis, in U.S. dollars per gallon and U.S. dollars per metric ton).

Archived base oil price reports can be found through this link: https://www.lubesngreases.com/category/base-stocks/other/base-oil-pricing-report/

Historic and current base oil pricing data are available for purchase in Excel format.

*ExxonMobil prices obtained indirectly.
**Rerefiner