Asia Base Oil Price Report


The base oils market in Asia has yet to show definitive trends, as activity has not changed significantly since the beginning of the year, and fundamentals appeared to be in flux. Base oil prices were mixed, with some grades moving down and others holding at current levels or edging up, depending on supply and demand factors. Crude oil and feedstock prices were up one day and down the next, underscoring the uncertainties.

There were expectations that business would remain somewhat lackluster until after the Lunar New Year holidays, when many buyers tend to return to the market to fill depleted inventories. The economic slowdown in China brought about by surging COVID infections has stifled prospects for a strong demand pickup ahead of the holidays, and concerns about a global recession were still affecting fuel and lubricant consumption in other Asian nations as well. According to media reports, China’s gross domestic product grew by 3% in 2022, down from an 8.1% rate in 2021 and below the government target of 5.5%. Car sales in China were down in December compared to the same month the previous year, reflecting downcast consumer sentiment.

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Another blow to China’s self-confidence came from reports that reflected a shrinking population for the first time since 1961, when a famine triggered by former leader Mao Zedong’s Great Leap Forward plan caused about 30 million deaths. While the effects of this trend were not expected to be felt immediately, it will have implications for the country’s economic growth in the future.

At the same time, large number of people travel to their hometowns in China ahead of the Lunar New Year holidays, which results in increased demand for fuels and lubricants from the transportation and automotive segments. Furthermore, blenders were expected to acquire base oils after the holidays to increase lubricant production in anticipation for the spring oil changing season.

Chinese importers have shown subdued interest in imports, given lukewarm demand and the possibility of meeting requirements through domestic supplies, which were deemed plentiful. A number of Chinese base oil plants were heard to be running at reduced rates due to the slump in demand in recent weeks and some were also shut down for tax inspections, according to reports.

Buying appetite for imports of the heavy grades – API Group I bright stock in particular –

was anticipated to strengthen in China as industrial activity was likely to increase after the Lunar New Year when COVID infections were also expected to stabilize, although some observers noted that numbers might skyrocket following the temporary mass migration during the festivities.

Interest in bright stock was generally strong in the region against snug supplies and spot prices jumped as a result. There was some bright stock availability noted in Thailand; however, buyers were holding off purchases in hopes values would soften as other base oil prices were losing ground.

Buying appetite for Group II grades was said to be growing, but export volumes from Taiwan were expected to be lower than usual in January as the sole Group II producer appeared to have fewer cargoes for export. There was speculation the producer might be building inventories ahead of a turnaround, although this could not be confirmed.

Other Northeast Asian producers, mainly in South Korea, have been busy arranging shipments of Group II and Group III grades to a wide array of destinations, including the U.S. and other ports in the Americas. A 4,000-metric ton lot of two grades was expected to be shipped from Daesan or Ulsan to Houston, U.S., in January or February.  Between 3,000 and 5,000 metric tons were on the table for shipment from Onsan to Houston or New Orleans, U.S., in February. A small 1,000-ton cargo was heard discussed for shipment from Onsan to Bangkok, Thailand, in early February too. About 2,000 tons were being considered for lifting in Yeosu or Ulsan for Gebze, Turkey, in the second half of February.

In India, import volumes showed a decline at the end of 2022, compared to the same period the previous year. This also coincided with lackluster demand for base oils from Indian consumers. U.S. shipments were largely absent due to a lack of readily available cargoes and steep prices, and plant maintenance in the Middle East also limited availability of export cargoes bound for India. However, there were indications that activity has picked up and several cargoes from the United Arab Emirates and Saudi Arabia were being worked on. Between 10,000 and 16,000 metric tons of base oils were being considered for shipment from Ras Laffan and/or Sitra, Bahrain, to West Coast India in mid Feb. A 4,000-ton parcel was mentioned for lifting in Yeosu, South Korea, to Mumbai in second half Feb. A 5,000-ton lot was also in discussions for shipment from Malacca, Malaysia, to Chennai in second half Jan.

Buyers in India remained cautious and secured mostly smaller base stock cargoes to run day-to-day operations on concerns that prices would slip in coming days. Domestic base oil producers were running plants at full rates, and this offered a certain comfort to consumers as they felt confident about being able to secure local product, although light grades were somewhat tight. However, at least a couple of South Korean light-grade shipments have been lined up for delivery in late January and February.

Spot base oil prices in Asia were mixed, with values for some base oils edging up, others moving down, and a few remaining unchanged, depending on market fundamentals. The price ranges portrayed below reflect discussions, bids and offers, as well as deals and published prices widely regarded as benchmarks for the region.

Most ex-tank Singapore prices experienced downward adjustments. Spot prices for the Group I solvent neutral 150 grade were lower by $20/t at $920/t-$950/t, and the SN500 was also down by $20/t at $1,030/t-$1,070/t. Bright stock was steady at $1,280/t-$1,320/t, all ex-tank Singapore.

Prices for the Group II 150 neutral were assessed lower by $20/t at $970/t-$1,010/t, and the 500N slipped by $30/t to $1,000/t-$1,050/t, ex-tank Singapore.

On an FOB Asia basis, Group I SN150 edged down by $20/t to $790/t-$830/t, but the SN500 was unchanged at $820/t-$860/t. Bright stock prices rose by $20/t to $1,060/t-1,100/t, FOB Asia.

The Group II 150N was assessed lower by $20/t at $800/t-$840/t FOB Asia, and the 500N and 600N cuts were down by $10/t at $820/t-$850/t, FOB Asia.

In the Group III segment, prices were largely unchanged. The 4 cSt was assessed at $1,520-$1,560/t, and the 6 cSt was steady at $1,490/t-$1,530/t. The 8 cSt grade was hovering at $1,210-1,250/t, FOB Asia, for fully approved product.

Upstream, crude oil futures continued to be influenced by supply and demand prospects and economic data. Oil futures fell by nearly $1 in early trading on Thursday, extending losses from the previous session, on a surprising build in U.S. crude stocks, coupled with downbeat U.S. retail sales and output data, which underscored concerns about a potential recession. Futures had moved up on Wednesday because the latest market report from the International Energy Agency forecast global oil demand would hit a record 101.7 barrels per day this year, with nearly half of that coming from China, reported.

On Jan. 19, Brent March 2023 futures were trading at $84.29 per barrel on the London-based ICE Futures Europe exchange, from $83.73/bbl on Jan. 12.

Dubai front month crude oil (Platts) financial futures for February settled at $81.82 per barrel on the CME on Jan. 18, compared to $79.19/bbl on Jan. 11.

Gabriela Wheeler can be reached directly at 

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

Archived base oil price reports can be found through this link:

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

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