The Washington administration also imposed sanctions on two key Russian oil refineries, Rosneft and Lukoil, to pressure Russia to stop its attacks on Ukraine. China and India are among the largest importers of Russian oil, and major Chinese and Indian state-owned oil companies have suspended purchases of seaborne Russian oil in response to the new U.S. sanctions.

The sanctions prompted a jump in crude oil futures, with West Texas Intermediate moving up to the mid $60s per barrel from around $57/bbl the previous week. If the U.S. reaches a trade agreement with China, it would assuage fears of an economic slowdown of the world’s two largest economies, which would potentially lead to reduced oil consumption and a global oil glut.

Steeper crude oil prices could offer support to base oil prices. Postings have been exposed to downward pressure over the past several weeks given softer demand and growing supplies along with lower crude futures. However, a majority of posted prices have shown little change since May, with the exception of Chevron’s postings, which were adjusted down on September 30.

As reported last week, the U.S. has also started to implement the first round of higher port entry fees that the U.S. and China planned to impose on each other’s vessels on October 14. This action was expected to lead to freight rate increases as fewer vessels were anticipated to be available on transpacific routes while ship operators tried to reshuffle their vessel line-ups.

Group I

Supply and demand were generally balanced within the API Group I segment, although the light grades appeared to be snug compared to the heavier grades. Perhaps bright stock was an exception in that availability was still more limited than for other cuts and prices have been holding. The Group I category emerged from a string of plant turnarounds earlier in the year displaying tight conditions, which partly insulated this segment from the downward pressure that the Group II grades had been exposed to. Most recently, a brief unplanned shutdown at Calumet’s Group I and Group II unit in Shreveport, Louisiana, had also contributed to a tightening of spot supplies.

While producers had been somewhat anxious to pursue export transactions to lower inventories at the end of the summer driving season–when base oil demand starts to decline–they seemed to have fewer extra cargoes to offer and the arbitrage to other regions has been more difficult to work. There was still buying interest from various destinations in Latin America, with Mexican buyers showing appetite for U.S. cargoes. However, economic uncertainties in the country have dampened lubricant consumption and base oil buyers have turned more cautious about prices and volumes. There continued to be reports of roadblocks for acquiring or renewing import licenses as the Mexican government seeks to implement tariff and customs reforms to reduce the illicit import of fuels and protect domestic production.

Movements of U.S. base oils into Brazil have declined, as demand has weakened, domestic supplies are able to meet a large portion of requirements, and import prices were considered too steep. There were rumblings that the local producer would be rolling over October prices into November, and this offered an added incentive for consumers to rely on domestic supplies as much as possible. There were also expectations of more competitive Group II offers emerging from the U.S. over the next few weeks, once the turnaround at Excel Paralubes’ Group II/Group III plant in Louisiana is completed and suppliers are able to determine how much spot material is available in the domestic U.S. system. Group I grades are sometimes replaced with Group II cuts if prices are more competitive and approvals are not a problem.

As is the case in the U.S., bright stock was tight in Brazil and spot prices have strengthened. Import flows of Group I heavy grades from neighboring Argentina have slowed down, with prices heard to be steady.

Observers expected the Argentine government to continue with its current monetary policy since the party of the current president, Javier Milei, won crucial mid-term legislative elections over the weekend. This was also considered a victory for president Trump, who had endorsed Milei and had promised a bailout from the U.S. in the form of a $20 billion currency swap, which would only be granted if Milei’s party succeeded in the elections.  

Group II

The Group II category showed temporary tightness because of an ongoing turnaround at

Excel Paralubes’ Group II/Group III plant in Lake Charles, Louisiana, which started in early October and was expected to be completed in mid-November. The producer had been running the unit below capacity for most of the year, but was expected to achieve improved run rates after the turnaround. Excel had 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. Most suppliers preferred to limit spot business until a clearer picture emerged about the supply and demand situation in the domestic market.

Motiva was also heard to be rebuilding its inventories following a shutdown at its Group II/Group III unit in Port Arthur, Texas, in August/September. Spot supplies for certain grades had remained limited from the producer, according to sources.

Rerefiners reported similar conditions to the overall market, pointing to weaker demand and an expected increase in supply levels as starting to exert pressure on base oil prices, although at least one rerefiner reported a snug position on Group II+ heavy grade on strong contract business, and there appeared to be healthy interest in the Group III grades as well.

Once all Group II units are running full out, additional availability of base stocks is expected to emerge. Suppliers are more likely to look for opportunities to lower inventories ahead of year-end, with cargoes anticipated to be offered to export destinations such as India.

Group III

The Group III segment was described as balanced and prices stable, partly because a couple of suppliers have concluded business into other regions and pressure to find buyers in the U.S. has eased. Nevertheless, there may be an uptick in negotiations over the next few weeks as a number of import cargoes were expected to arrive in the U.S. Fresh buying interest for spot cargoes from the Middle East and Asia was heard to have emerged, although demand in general has been lackluster, particularly because consumption from the PCMO sector was less robust than earlier in the year.

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

Prices for naphthenic base oils were stable, despite recent crude oil price fluctuations. A balanced-to-tight supply situation as a result of an ongoing turnaround at a key facility offered support to prices. The light grades were less readily available as demand from the transformer oil segment remained healthy.

Ergon’s naphthenic base oils plant in Vicksburg, Mississippi, was shut down from early September until mid-October to undergo a comprehensive maintenance and upgrade program. The company had built inventories to cover contract commitments before starting the turnaround, but spot supply from the producer had been restricted.

Crude Oil

Crude oil futures slipped on Tuesday on news that OPEC+ was planning to increase output in December. Some price support came after reports by the American Petroleum Institute showed an estimated drop in U.S. crude oil inventories of 4 million barrels in the week ending Oct. 24, when analysts had expected a smaller dip of around 3 million barrels.

• West Texas Intermediate December 2025 futures settled on the Nymex at $60.15 per barrel on Oct. 28, up from $57.24/bbl for front-month futures on Oct. 21.
• Brent futures for December 2025 delivery were trading on the ICE at $64.53/bbl on October 29, up from $61.51/bbl for front-month futures on Oct. 22.
• Louisiana Light Sweet crude wholesale spot prices were hovering at $63.53/bbl on Oct. 27. Spot prices had settled at $60.44/bbl on Oct. 20, according to the U.S. Energy Information Administration.

Diesel

Low-sulfur diesel wholesale, Oct. 27 (Oct. 20), EIA
New York Harbor: $2.49 per gallon ($2.24/gal)
Gulf Coast: $2.34/gal ($2.10/gal)
Los Angeles: $2.58/gal ($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