Asia Base Oil Price Report


Following fairly significant decreases last week, spot prices in the Asian base oils market seemingly continued on free fall. Several export shipments were concluded during the week, and this has taken some of the pressure off producers’ shoulders, who were concerned about surplus supplies, but they had to acquiesce to lower bids to place products. Refiners were also considering trimming operating rates to avoid bulging inventories. More moderate crude oil and feedstock prices contributed to the downward adjustments in base oil pricing as well.

Crude oil prices remained volatile, rising one day and falling the next, but have declined from levels seen in early July, when Brent futures were hovering at $104 per barrel. Crude futures rose 1.5% after hitting a six-month low on Wednesday on the back of a larger drawdown in U.S. crude stocks than expected, eclipsing concerns about a possible recession and about rising Russian exports.

On Aug. 18, Brent October futures were trading at $95.13 per barrel on the London-based ICE Futures Europe exchange, from $98.49/bbl on Aug. 11.

Dubai front month crude oil (Platts) financial futures for September settled at $90.15 per barrel on the CME on Aug. 17, compared to $93.49 on Aug. 10.

Mounting base oil supplies in Asia, as well as other regions, supported buyers’ perception that products were not difficult to obtain and that they would be able to hold off on securing material until prices came down, leading to lukewarm buying interest on a global scale.

Geopolitical tensions, economic uncertainties and the recent high fuel prices have affected consumer trends in most countries, with inflation and fears of a recession dampening purchase levels. These conditions have affected various segments, from basic needs to cars and lubricants.

In the key market China, there were signs that the country’s economy was on track for its slowest growth in decades as the country dealt with the impact of its strict COVID-related restrictions, The New York Times reported. The real estate market, which drives about one-third of China’s economic activity, has been particularly vulnerable. The construction segment is a huge consumer of petrochemicals. Hundreds of thousands of frustrated homeowners in more than 100 cities across China joined together and refused to pay back loans on their unfinished properties.

On the other hand, the Chinese automobile industry saw a strong uptick in July, with auto sales surging by almost 30% from a year earlier, extending a recovery that began in June thanks to government incentives to purchase cars and the country’s easing of COVID-related lockdowns, according to data published by Reuters.

Lubricant and base oil demand has slumped, however, with most domestic requirements being filled by locally produced material and import volumes being slashed as prices were not considered competitive. Demand was deemed generally disappointing, but suppliers hoped it would pick up ahead of the National Day and Golden Week holidays in October.

Despite the lower import levels, there were still several cargoes concluded from Northeast Asia to China this month, and alternatively, a few parcels were exported from China, although high freight rates and limited vessel space were hampering business. It was heard that 12,000 metric tons were likely to be shipped from Singapore to Taicang, China, in early September. A 7,400-metric ton cargo was mentioned for shipment from Dumai, Indonesia to Nantong, China and Ulsan, South Korea, at the end of the month.

The sole Taiwanese API Group II producer has trimmed its shipment volumes to China, which was a regular receiver of Taiwanese products under contract and spot business. The producer has found other outlets for its products in the Americas and the Middle East. This week, it was heard that a 3,000-5,000 metric ton parcel was on the table for shipment from Mailiao to Hamriyah, United Arab Emirates, in late August.

South Korean producers also typically ship product to China, but they have also been active in other export segments, particularly as most South Korean plants were running at optimal rates. About 20,000 to 40,000 metric tons were expected to be shipped from Ulsan to Houston, United States, at the end of August. Another 4,000 metric tons were mentioned for shipment from Ulsan to Houston, also in late Aug. A 10,000 metric ton lot was being quoted for lifting in Daesan or Pyongtaek to the U.S. Gulf in the first half of September.

In India, base oil demand remained lackluster due to the monsoon season, which leads to logistical issues and slower lubricant consumption. Several import cargoes were due to arrive over the next few weeks, adding to the notion that there was sufficient material to cover current needs. Buyers resisted offer levels and preferred to wait and see if prices would move down further before securing quantities beyond those needed for daily operations. Some sellers were hoping to ship cargoes onward to other countries, as prices in India were falling. A number of parcels were shipped from India to the Middle East, with a 5,000-metric ton lot being discussed to move from Mumbai to the United Arab Emirates in early Sep.

In Southeast Asia, producers were struggling to find buyers, as interest for some of the heavier grades has receded, resulting in extra supplies weighing on the market. Prices have come down as suppliers tried to entice buyers, with some cargoes moving intra-regionally and some to more distant destinations. A 2,000-metric ton parcel was discussed for shipment from Rayong, Thailand, to Hamriyah, United Arab Emirates, in 1H September.

Spot base oil prices in Asia were adjusted down this week on mounting supply levels, slower demand and softer feedstock prices. The ranges portrayed below reflect discussions, bids and offers, as well as deals and published prices widely regarded as benchmarks for the region.

Ex-tank Singapore prices saw hefty downward adjustments week on week. Spot prices for the Group I solvent neutral 150 grade plummeted by $100/t to $1,020/t-$1,050/t, and the SN500 was also lower by $100/t at $1,190/t-$1,230/t. Bright stock was assessed down by $100/t as well at $1,260/t-$1,300/t, all ex-tank Singapore.

Prices for the Group II 150 neutral fell by $60/t to $1,180/t-$1,220/t, while the 500N also dropped by $100/t to $1,190/t-$1,230/t, ex-tank Singapore.

On an FOB Asia basis, Group I SN150 was down by $100/t at $870/t-$910/t, and the SN500 dropped by $50/t to $1,050/t-$1,090/t. Bright stock prices fell by $50/t as well to $1,070/t-1,120/t, FOB Asia.

The Group II 150N fell by $100/t at $980/t-$1,020/t FOB Asia, and the 500N and 600N cuts were also down by $100/t to $1,030/t-$1,080/t, FOB Asia.

In the Group III segment, prices experienced more moderate decreases. The 4 centiStoke was down by $40/t at $1,570-$1,610/t, and the 6 cSt was also down by $40/t at $1,550/t-$1,590/t. The 8 cSt grade moved down by $40/t as well to $1,280-1,320/t, FOB Asia, all for fully approved product.

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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