While the tariffs do not impact base oil import and export prices directly, they do affect the price of various raw materials and inputs utilized by lubricant and finished products suppliers in their manufacturing operations. Blenders continued to be challenged by hefty lubricant inventories given dwindling demand after the end of the driving season, and difficulties in transferring higher production costs onto finished products due to price competition among manufacturers.

Group I
There were signs that the Group I segment was still tighter than the Group II category, although Group II cuts were also less available for spot transactions since one of the key U.S. Group II producers shut down its plant for a turnaround this month.

Group I suppliers said that demand had been fairly steady over the last few weeks, but they did acknowledge slightly weaker consumption from industrial and heavy-duty applications. Even so, bright stock appeared to be tightening further and maintaining price levels as a producer has exported some of its output, limiting spot availability.

Additionally, Calumet was understood to be rebuilding inventories after having restarted operations at its Group I and Group II unit in Shreveport, Louisiana, following a brief unplanned shutdown in early September. This was expected to reduce spot availability in the market.

Given the current supply situation, most Group I suppliers would have difficulties gathering substantial volumes for export after meeting contractual commitments, as regular shipments to Mexico and other destinations in Latin America proceeded as expected. Railcar volumes have appeared in the market and were exerting some pressure on spot prices.

Mexican buying interest was more subdued than earlier in the year, partly dampened by economic uncertainties and tariff concerns, but also because buyers typically delay purchases and contract negotiations until the last months of the year. That is when U.S. suppliers offer competitive pricing to find a home for the extra supplies they kept during the hurricane season in the U.S. Atlantic basin.

Participants also reiterated concerns about Mexican tariff and customs reforms that may have an impact on fuel and base oil imports moving forward, particularly how the Mexican authorities plan to monitor truck and railcar shipments. The Mexican government has also proposed tariff reforms that would expand the number of product classifications affected by new duties, potentially increasing costs for some imports. 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 reflect the government’s intention of tightening government control of the energy sector and might ultimately affect base oil imports as light grades are often used in fuel blending.

Demand from another key market for U.S. exports, Brazil, has also fizzled somewhat in recent weeks because many buyers sought to meet their product needs through domestic supplies. A key Brazilian supplier has maintained October prices unchanged from September, when values had been adjusted down. There were plentiful supplies of the Group I heavy grade, exerting downward pressure on pricing. Buying interest for Group II grades surfaced in Brazil over the last couple of weeks, but could not be kept afloat because of weighty U.S. offer levels. However, buyers adopted a wait-and-see position as they anticipated more competitive U.S. offers in November and December when producers release additional inventories.

In other Latin American business, a 10,000-ton cargo was discussed for shipment from La Plata, Argentina, to Lagos, Nigeria, in November.

Group II
The Group II base oils segment was described as more balanced than in the previous weeks, and this equilibrium was partly possible because of the start of a turnaround at the Excel Paralubes’ plant in Louisiana this month. Suppliers’ efforts to reduce inventories at the end of the hurricane season seemed to pause while participants evaluated their supply positions against current requirements. Some buyers were concerned about a possible shortage of Group II grades, but most indications pointed to adequate supplies to meet demand. If anything, the Group II 600N grade appeared slightly more exposed to downward pressure on ample supplies. Ongoing competition from the rerefined base oils segment also challenged conventional base stock prices, particularly the light grades.

Excel Paralubes began a scheduled maintenance program and catalyst change at the beginning of October, with the unit expected to be offline for approximately four to six weeks. The producer had been running the Group II/Group III facilities below capacity for most of the year, but was expected to achieve improved run rates after the turnaround. Excel had also built inventories to cover contractual commitments during the outage and this had limited spot availability from the producer, according to sources. There was no direct producer confirmation about the plant’s operations.

With the current domestic Group II supply and demand situation a bit in a holding pattern, sellers appeared more guarded regarding export transactions. Several cargoes had been finalized for export business ahead of the turnaround, with a number of shipments expected to move to India. But the pace of the discussions seemed to have slowed down. India also was expected to enter a more subdued activity period as the country celebrates the religious Diwali festival on Oct. 18-23.

Group III
The Group III segment was described as in better balance than in the previous weeks, although spot prices continued to experience some downward pressure. The pressure stemmed from weaker demand versus mounting supplies as several import cargoes have arrived in the U.S. and additional ones were understood to be on the way from Canada, Asia and the Middle East. However, import volumes were expected to be reduced moving forward as overseas suppliers have captured more attractive export opportunities in other regions.

There has been reduced demand for Group III imports from some U.S. base oil producers who also have downstream lubricant manufacturing operations as they have started to produce their own Group III base stocks, while a key U.S. producer plans to expand its Group III production by 2028.

Importers were also facing additional challenges as freight rates have moved up due to a more limited number of vessels on transpacific routes. One possible bright spot in terms of shipping was the fact that a peace deal between Israel and Hamas would likely dissuade Houthi rebels from attacking vessels in the Red Sea, and ships could return to traversing the Suez Canal safely instead of being forced to take a longer route around the southern tip of South Africa.

Softer demand from the PCMO segment was also partly to blame for the current conditions. Demand for factory-fill lubricants has been impacted by declining passenger car sales in late 2025 due to an expected economic slowdown and cooling labor market, among other factors. 

Excel Paralubes was heard to have shut down its Group II and Group III plant in Lake Charles, Louisiana, 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

On the naphthenic base oils front, prices were reported as stable to soft, with market players keeping a close eye on crude oil prices. With futures having fallen to five-month lows, there was room for additional discounts and discussions of potential base oil price adjustments should prices linger at reduced levels for several weeks.

Some price support came from a balanced-to-tight supply and demand ratio, brought on by the turnaround at Ergon’s naphthenic base oils plant in Vicksburg, Mississippi, that started in September and was expected to be completed in mid-October. Ergon had built inventories before starting a comprehensive 45-day maintenance program to maintain supplies to ratable customers, but there were expectations that the turnaround would have tightened spot supplies. Other suppliers were also mulling potential production cuts given softening market conditions and current competing fuel prices.

Availability of the heavier grades was more plentiful because demand from the rubber and tire industries was sluggish, while requirements for the light grades remained healthy.

Crude Oil

Crude oil futures retreated on Tuesday, weighed down by escalating U.S.-China trade tensions and ample global crude oil supplies, with the International Energy Agency also predicting a significant supply glut into 2026.

• West Texas Intermediate November 2025 futures settled on the Nymex at $58.70 per barrel on Oct. 14, down from $61.73/bbl for front-month futures on Oct. 7.
• Brent futures for December 2025 delivery were trading on the ICE at $62.32/bbl on October 15, down from $66.22/bbl for front-month futures on Oct. 8.
• Louisiana Light Sweet crude wholesale spot prices and diesel prices were not available from the Energy Information Administration on Oct. 13 due to the Columbus Day federal holiday.

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 15, 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