Asia Base Oil Price Report


Crude oil price volatility and unresolved supply chain issues, along with tightening supply and heightened demand resulted in higher base oil prices across Asia. As long as the Russian war on Ukraine continued and energy prices remained highly unpredictable, Asian players were expected to see sharp base oil price fluctuations over the next few weeks, market sources concurred.

Similar upward price pressure was observed in other regions, which meant that Asian base oil buyers would not be able to find much relief by seeking product from Europe, the Middle East, or the Americas.

Get alerts when new Sustainability Blog articles are available.


The start of the spring lubricant production cycle, together with a spike in demand from buyers concerned about possible price hikes in coming weeks, has led to a tighter supply/demand scenario in most areas, with the API Group I grades appearing to be the most strained at the moment given a more limited number of sources. As a result, prices for these cuts have jumped.

Upcoming turnarounds in Asia at Group II and Group III plants were also expected to lead to overtaxed supplies of these grades, with prices moving up accordingly during the week. Some of the producers who will be shutting down their facilities for maintenance have started to build inventories to cover at least term contracts during the outages. As a result, there were fewer spot cargoes on offer.

The turnarounds included a one-month partial maintenance program at SK’s plant in Ulsan, South Korea, in April-May that would affect Group III production. Also in South Korea, GS Caltex’s Group II and Group III plant in Yeosu, South Korea, was expected to undergo a turnaround for three weeks in April. South Korean producer Hyundai-Shell will also be shutting down its Group II plant in Daesan in April slightly over a month of maintenance. There were also expectations that Handi Sunshine would be performing maintenance at its Group II refinery in Hainan for two months, starting this month.

The sole Taiwanese Group II producer was heard to be running at higher rates, following a few weeks of reduced production due to a fire at the refinery in Mailiao in late January. It was heard that the supplier would be shipping a couple of cargoes to India and/or the Middle East in April and one to Brownsville, U.S., aside from its regular shipments to term customers in the domestic market and nearby countries.

In Southeast Asia, a Thai Group I producer was anticipated to complete a turnaround this month. Another producer was expected to start at turnaround at its plant in Malaysia at the end of April. The turnaround schedule was not confirmed by the producers directly.

Group I supplies of light grades have dwindled in Southeast Asia, as regional buyers have been snapping up cargoes when they become available, while buyers in more distant destinations such as China were finding it difficult to secure product due to climbing values, logistical issues and climbing freight rates. It appears that transactions within Southeast Asia and into India were more feasible. A cargo of about 4,000 metric tons of base oils was heard in discussions for shipment from Port Klang, Malaysia, to India in late March/early April. Another parcel was being considered for lifting in Rayong, Thailand, to West Coast India and/or Sharjah, United Arab Emirates.

In India, the supply/demand ratio has tightened on steady requirements and increasingly limited availability, both of domestic volumes and imports. While there were still cargoes expected to arrive from the U.S. and the Middle East in coming weeks as these parcels had been lifted a few weeks ago, the influx was expected to taper off because fresh transactions have become more difficult to conclude given rising prices at origin, coupled with reduced spot quantities.

There used to be opportunities to import cargoes from Russia, but with international sanctions on Russian financial institutions imposed in a bid to stop its war on Ukraine, most traders were trying to stay away from conducting business involving Russian products. As was the case in other countries, local refiners in India were also choosing to stream more feedstocks into fuel production in detriment of base oil output. There were expectations of a number of South Korean cargoes being shipped to India in late March and April, with a 20,000 metric ton lot mentioned for lifting from Daesan and Pyongtaek to India the last week of March. However, given the heavy upcoming turnaround schedule in South Korea, the stream of shipments from that country may dwindle.

In China, importers and end-users have become more hesitant about upping their bids to secure product because of fluctuations in crude oil prices and uncertainties related to COVID-19 lockdowns in a few major Chinese cities. While light grades are generally more available in China than the heavy viscosities – China has a structural deficit of these cuts – supplies have been snug for all grades. This was partly due to the fact that refiners have favored the production of fuel versus that of base oils because of market economics, as fuel prices have shot up on steep crude oil values in recent weeks. Demand for the heavy grades was expected to tick up in coming weeks as these cuts are favored in lubricant formulations during the warmer months. Several South Korean cargoes were heard concluded for shipment to China in April.

Spot base oil prices in Asia have firmed, with a majority of grades showing upward adjustments on tightening supply and healthy demand. The ranges portrayed below reflect bids and offers, as well as deals and published prices widely regarded as benchmarks for the region.

Ex-tank Singapore prices jumped from last week on firm fundamentals. The Group I solvent neutral 150 grade was up by $30/t at $1,030/t-$1,060/t, and the SN500 was also higher by $30/t at $1,180/t-$1,220/t. Bright stock jumped by $60/t to $1,310/t-$1,350/t, all ex-tank Singapore.

Prices for the Group II 150 neutral moved up by $50/t to $1,090/t-$1,130/t, while the 500N edged up by $40/t to $1,190/t-$1,250/t, ex-tank Singapore.

On an FOB Asia basis, Group I SN150 climbed by $50/t to $980/t-$1,020/t, and the SN500 was also up by $50/t at $1,050/t-$1,090/t. Bright stock increased by $60/t to $1,110/t-1,150/t, FOB Asia.

The Group II 150N was assessed higher by $20/t at $970/t-$1,010/t FOB Asia, and the 500N and 600N cuts edged up by $50/t to $1,010/t-$1,050/t, FOB Asia.

In the Group III segment, prices were also firming. The 4 centiStoke was assessed up by $10/t at $1,480-$1,520/t, and the 6 cSt edged up by $10/t as well to $1,460/t-$1,500/t. Likewise, the 8 cSt grade was adjusted up by $10/t to $1,190-1,220/t, FOB Asia, all for fully approved product.

Crude oil futures showed wild fluctuations over the week, with prices jumping on Monday by more than 7% as members of the European Union discussed whether to issue an embargo on Russian oil and gas during meetings with U.S. President Joe Biden, although analysts believed a complete ban by the E.U. was unlikely. Prices were mixed on Thursday in Asian trading because of continued concerns of a potential oil shortage if there were further constraints on Russian oil trading.

On March 24, Brent May futures were trading at $121.50 per barrel on the London-based ICE Futures Europe exchange, from $101.54/bbl on March 17. Brent futures had traded at $115.72/bbl on March 10.

Dubai front month crude oil (Platts) financial futures for April settled at $113.74/bbl on the CME on March 23, from $92.69/bbl on March 16 and $102.54/bbl on March 9 (CME note: Settlement prices on instruments without open interest or volume are provided for web users only and are not based on market activity.)

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.

Related Topics

Base Oil Pricing Report    Base Stocks    Market Topics    Other