Asia Base Oil Price Report


Market participants were trying to assess what impact the sanctions imposed on Russia as a consequence of its invasion of Ukraine would have on the base oils and lubricant markets. The most evident effect was the sharp climb of crude oil, natural gas and feedstock prices, which have surpassed multi-year highs, but the exit of international corporations from Russia may also have an indirect effect on business.

While official sanctions on Russian oil and gas exports are not widespread yet, Canada has banned Russian oil imports, and other countries are expected to follow suit. “It’s encouraging to see Russia is finding it extremely difficult to sell its oil – even though sanctions haven’t gone there yet, buyers are staying away and no-one wants to ship the stuff,” Fortune magazine reported online.

Get alerts when new Sustainability Blog articles are available.


Fears of a crude oil shortage and the rapid ascent of oil values precipitated more upward movements in base oil pricing in Asia. Producers had already started to adjust prices up as feedstock values have been on an upward trek for the past two months, and the situation in Eastern Europe deepened concerns about potential oil and gas supply shortages and persistent price pressure. Some sellers have suspended offers as they assessed the consequences of the steeper feedstock costs.

Furthermore, supply of a number of base oil grades has tightened on renewed buying interest and refinery rate adjustments. Given the rapid rise in fuel prices, some refiners were favoring fuel production over base oil output, leading to a tightening of base stocks. Buyers, on their part, have started to worry that base oil prices might continue on an upward trek for the foreseeable future and have come to the market to replenish stocks.

Additionally, a number of turnarounds were on the horizon in Asia, with participants expecting a further tightening of availability, which drove many to secure additional cargoes to avoid possible shortages.

In China, there were expectations that Handi Sunshine would be shutting down its API Group II refinery in Hainan for two months, starting this month. It was also heard that SK’s plant in Ulsan, South Korea, would be undergoing a partial shutdown from March to May which would affect Group III production. GS Caltex has scheduled a turnaround at its Group II and Group III plant in Yeosu, South Korea, for a three-week turnaround in April. Also in South Korea, Hyundai-Shell will be shutting down its Group II plant in Daesan for almost a month of maintenance.

Supplies from Southeast Asia were also expected to suffer a dent as a Thai API Group I producer prepared for a turnaround this month, while buying interest in Group I heavy grades and bright stock were expected to see a seasonal upswing in demand.

Regional supplies of Group II grades have tightened ahead of the upcoming turnarounds and some production hiccups at the Taiwanese Group II plant in Mailiao. The Taiwanese producer had ramped up rates following a fire at the refinery in late January, but was heard to have dialed back production due to ongoing technical issues, although this could not be confirmed with the producer directly.

In India, the influx of base oil cargoes from the United States was expected to slow because of tighter supplies at origin, along with steeper prices as U.S. producers have nominated posted price increases for late February and early March implementation. This has turned prices less attractive and given the climbing cost of freight, transactions have been more difficult to finalize. However, Indian buyers continued to show interest in securing more cargoes and several shipments that were booked a few weeks ago were also expected to arrive in India over the next few weeks.

Buyers have canvassed the market for light viscosity cargoes from other origins as well, and it was heard that 12,000 metric tons of base oils had been booked from Cartagena, Spain, to Mumbai in early March, with other possible shipments from Europe being discussed. Russian imports appeared to be out of the picture, even though there have been no official sanctions on base oil exports from that country.

South Korean producers have been actively filling requirements in India, as well as in other North- and Southeast Asian destinations. In shipping circles, a 1,000-metric ton lot was being discussed for shipment from Onsan to Tianjin, China, in the first half of April. A 1,200 metric ton cargo was on the table for shipment from Yeosu to Yokohama, Japan, in mid-March. About 4,000 metric tons were discussed for prompt lifting from Yeosu to Koh Si Chang, Thailand.

South Korean producers have also finalized business into more distant destinations such as South America. About 2,000 metric tons were expected to move from Ulsan to Ecuador this month, and other opportunities were being discussed. However, upcoming turnarounds and a need to build inventories was limiting spot offers from South Korean producers.

Chinese buying interest has experienced a resurgence, with consumers particularly looking for the heavy grades to replenish stocks. As a result, domestic values have strengthened, while import prices were exposed to upward pressure. It was heard that buyers had looked for cargoes in Southeast Asia, but availability from suppliers has dwindled as a couple of them have sold out their March availability and were holding back from making fresh offers, given the current crude oil price uncertainty.

Spot base oil prices in Asia were generally higher, with a few of the grades more exposed to upward pressure given increasingly limited availability. Ex-Singapore prices also underwent upward adjustments on a producer’s steeper price indications. 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 volatile fundamentals. The Group I solvent neutral 150 grade was higher by $40/t at $890/t-$920/t, and the SN500 was up by $30/t at $1,040/t-$1,080/t. Bright stock edged up by $20/t to $1,180/t-$1,220/t, all ex-tank Singapore.

Prices for the Group II 150 neutral moved up by $20/t to $900/t-$940/t, while the 500N edged up by $10/t to $1,090/t-$1,130/t, ex-tank Singapore.

On an FOB Asia basis, Group I SN150 was $30/t higher at $800/t-$840/t, and the SN500 was also up by $10/t at $910/t-$950/t. Bright stock increased by $30/t to $950/t-990/t, FOB Asia.

The Group II 150N was assessed higher by $30/t at $850/t-$890/t FOB Asia, but the 500N and 600N cuts edged up by $20/t to $890/t-$930/t, FOB Asia.

In the Group III segment, prices were stable to firm. The 4 centiStoke moved up by $20/t to $1,440-$1,480/t, and the 6 cSt was also up by $20/t at $1,420/t-$1,460/t. The 8 cSt grade was unchanged week on week at $1,160-1,200/t, FOB Asia, all for fully approved product.

Crude oil futures climbed to ten-year highs, with Brent trading near $120 per barrel for the first time since 2012 as concerns about crude oil supply grew on increasingly vicious Russian attacks on Ukraine and disruptions to Russian oil exports as traders tried to avoid getting involved in the turmoil brought about by the war and international financial sanctions. Russia is one of the world’s largest crude oil producers.

On March 3, Brent May futures were trading at $116.82 per barrel on the London-based ICE Futures Europe exchange, from $104.47/bbl for April futures on Feb. 24.

Dubai front month crude oil (Platts) financial futures for April settled at $104.43/bbl on the CME on March 2, from $92.16/bbl for March futures on Feb. 23 (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