There appeared to be little change to the ongoing trade dispute between the U.S. and China, with U.S. President Donald Trump poised to start implementing an additional 100% tariff on Chinese imports on Nov. 1. While the levies would not have a significant impact on base oils, as the U.S. does not routinely import Chinese base stocks, they could affect the price of other raw materials and inputs required for the manufacture of lubricants, greases and other finished products. Trump plans to meet Chinese President Xi Jinping in South Korea next week.

One of the main concerns for the automotive industry specifically appeared to be the fresh export controls, including stricter export licenses, that China plans to impose on rare earth minerals, which could impact global automotive production, Reuters reported. Rare earth magnets power motors in car parts such as side mirrors, speakers, oil pumps, windshield wipers and fuel leakage and braking sensors and are even more crucial in EVs. Carmakers were racing to beat China’s rare earths deadline and were looking for alternative sources of the minerals. Even if Chinese suppliers can fulfill fresh orders before the Nov. 8 export controls take effect, it can take many days for a shipment to reach its destination, and the threat of a rare earth bottleneck is among several headaches facing the auto industry.

As part of an effort to counter Chinese controls on rare earth exports, on Monday Trump and Australian Prime Minister Anthony signed a critical minerals agreement that includes U.S. investments in rare earth mining projects in Australia, Reuters added.

Last week, on Oct. 14, the first round of steeper port entry fees that the U.S. and China planned to impose on each other’s vessels went into effect and was expected to affect freight rates, as fewer vessels were anticipated to be available on transpacific routes until ship operators can reshuffle their vessel lineups.

Group I
The lighter grades in the API Group I category appeared to be in a tighter spot than the heavier grades, although bright stock is still seeing steady demand despite weaker consumption of industrial lubricants due to a slowdown in manufacturing rates. Overall, the Group I segment has not been exposed to as much downward pressure as the Group II grades because of plant turnarounds earlier in the year and a recent brief unplanned shutdown at Calumet’s Group I and Group II unit in Shreveport, Louisiana, which tightened spot supplies.

Additionally, a couple of producers were understood to have concluded export business to India and Latin America, which tightened spot availability even further, although unsold railcar volumes have cropped up recently in the market and this has exerted pressure on spot indications.

Regular contract shipments continued to move to Mexico, but buying interest in spot cargoes was slightly more subdued than in previous months as buyers held off on purchases in hopes of more attractive prices in the coming weeks. Some lubricant segments in Mexico have also been affected by economic uncertainties and trade turmoil. Base oils moving from the U.S. into Mexico were not expected to be affected by the latest tariffs as long as they comply with the USMCA, but the Mexican government is working on tariff and customs reforms that may have an impact on fuel and base oil imports. In early October, Mexico issued new rules limiting the duration of fuel market permits and eliminating renewals for most imports, which could indirectly affect base oil shipments.

In Brazil, appetite for Group I and Group II spot cargoes appeared to have been reignited by a lack of readily available volumes, but there was still a gap between bids and offers that thwarted some transactions involving U.S. product. A key Brazilian Group I supplier’s pricing rolled over from September to October and these levels were difficult for importers to compete with. However, there were expectations of more competitive offers possibly cropping up over the next few weeks once the turnaround at Excel Paralubes’ Group II/Group III plant in Louisiana is completed and producers have a better sense of supply levels in the U.S. Sometimes scheduled turnarounds last longer than originally planned and this can cause a sudden market tightening, sources said.

Group II
The current tight situation in the Group II segment was expected to be temporary as a key producer’s plant was undergoing a planned turnaround and this has curbed spot supplies, according to sources.

As mentioned in previous reports, Excel Paralubes started a maintenance program and catalyst change at the beginning of October that was expected to last 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 has limited spot availability from the producer, according to sources. There was no direct producer confirmation about the plant’s operations.

While some suppliers had started to release the extra inventories held during the hurricane season along the U.S. Gulf Coast, some have withdrawn from spot export business while they assess the general supply situation. The Group II 600N grade seemed to be more available than the lighter grades and this exerted downward pressure on price ideas.

In the past, several cargoes moved to India in the last quarter of the year as the need for U.S. suppliers to find a home for their extra barrels results in attractive prices being offered, but discussions are fairly muted this week because activity in India has slowed during the observance of the Diwali holidays on Oct. 18-23.

Rerefiners reported similar conditions to the overall market, citing crude declines and waning demand as placing pressure on base oil sales, “but this is not unexpected during this time of the year,” a source said. One rerefiner described a snug position on the Group II+ heavy grade on strong contract business and there appeared to be quite a bit of interest in the Group III grades as well.

In terms of used motor oil collection, which participants see as a bellwether of market activity, rerefiners described healthy collection rates. “Our customers are telling us that car counts still remain strong in their oil change bays,” a source said. At least one rerefiner has announced increases for its waste oil collection charges and another acknowledged that charging for collection has been the only way for the industry to stay afloat, and most, if not all, collectors have implemented charges.

Group III
The Group III segment seems to have attained more balanced conditions, perhaps because a couple of suppliers have been able to place Group III base oils in other regions and pressure to sell into the U.S. has subsided. Even so, several import cargoes have arrived in the U.S. and additional ones were slated to be shipped from Canada, Asia and the Middle East over the next few weeks.

Suppliers reiterated concerns about reduced demand for Group III imports as a number of U.S. base oil producers who also manufacture lubricants have started to produce their own Group III base stocks, with ExxonMobil planning to significantly expand its Group III production by 2028.

Once again, lackluster demand from the PCMO segment was mentioned as one of the factors affecting Group III consumption levels and exerting pressure on pricing as newer vehicle models have longer oil change intervals and there are more electric and hybrid vehicles on the road. Market observers had expected car sales to decline in the fourth quarter but activity was surprisingly robust in the third quarter despite tariffs and other uncertainties. In early October, Reuters reported that U.S. auto sales, on average, were anticipated to show a 6% increase for the third quarter. Several of the largest automakers reported healthy U.S. sales gains for the third quarter. General Motors and Ford each said vehicle sales rose 8% and Toyota Motor Corp.’s North American unit reported a 14% increase.

The impact of Excel Paralubes’ turnaround at its Group II and Group III plant in Lake Charles, Louisiana, this month was expected to be limited as the unit produces Group III base oils for the company’s own internal consumption. Excel Paralubes does not comment on its production status.

Naphthenics

On the naphthenic base oils front, there continued to be rumblings of potential price adjustments should crude oil prices stay at reduced levels for an extended period. A balanced-to-tight supply and demand ratio, exacerbated by the turnaround at Ergon’s naphthenic base oils plant in Vicksburg, Mississippi, from September until mid-October, provided support to most prices.

Ergon had built inventories to cover contract commitments before starting a comprehensive 45-day maintenance program, but participants said that the turnaround had tightened spot supplies, particularly of the light grades. The heavier grades were more plentiful because demand from the rubber and tire industries has weakened following the end of the summer driving season. As is the case for paraffinic oils, this is also the time of the year when producers consider potential production cuts to avoid oversupply conditions.

Crude Oil
Crude oil futures had been weighed down by prospects of a global supply glut for most of the previous week and hit a five-month low on Monday, but values edged up for a second day on Wednesday, buoyed by supply concerns related to sanctions on Russian exports, hopes of a U.S.-China trade deal, and news that the U.S. would be buying oil for its strategic reserves.

• West Texas Intermediate December 2025 futures settled on the Nymex at $57.24 per barrel on Oct. 21, down from $58.70/bbl for front-month futures on Oct. 14.
• Brent futures for December 2025 delivery were trading on the ICE at $61.51/bbl on October 22, down from $62.32/bbl for front-month futures on Oct. 15.
• Louisiana Light Sweet crude wholesale spot prices were hovering at $60.44/bbl on Oct. 20. Spot prices had settled at $64.64/bbl on Oct. 6, according to the U.S. Energy Information Administration. There was no trading on Oct. 13 due to the Columbus Day federal holiday in the U.S.

Diesel
Low-sulfur diesel wholesale, Oct. 20, EIA
New York Harbor: $2.24 per gallon
Gulf Coast: $2.10/gal
Los Angeles: $2.39/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 22, 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