Weekly Asia Base Oil Price Report

Crude oil prices surged following news of the pipeline shutdown on growing fears of increased oil supply disruptions, with Brent crude trading almost 3% higher near $107 per barrel on Sunday and West Texas Intermediate futures close to $103/bbl.

The International Energy Agency has cut its global oil supply forecast for this year, citing “the protracted US-Iran diplomatic standoff” as a main driver. An IEA report released on Friday predicted that the world oil supply would fall to 100.7 million barrels per day in 2026–down 5.7 million barrels a day from the previous year.

Group I

Group I spot prices were holding at largely unchanged levels from a week ago as participants assessed the market situation and awaited developments in the Middle East. With Saudi Arabian oil shipments increasingly under threat of Houthi rebel attacks, Asian producers worried about potential crude supply shortages and climbing oil and fuel prices. This situation has partly influenced their decision to offer only smaller spot base oil cargoes so as to protect inventories and continue meeting contractual obligations.

But the more restricted availability did not seem to be a problem, as buyers appeared interested in securing only those volumes needed to run day-to-day operations and refrained from purchasing large lots.

Indian buyers may have been an exception, as more buying interest has been detected in this country following a period of sluggish demand due to the monsoon season. With inventories close to being depleted, Indian consumers have returned to the market in search of additional cargoes, aside from those they are able to secure from domestic suppliers.

Imported Group I SN150 and SN500 cuts and bright stock CFR India prices were steady from last week because of more limited spot supplies, and even though the restrictions would normally have pushed prices up, the presence of competitively-priced domestic supplies kept import indications from edging up. Climbing crude oil and feedstock values offered support to Group I prices as well.

Domestic refiners kept prices steady in India during the week. Sanctions on Iranian imports kept prices for products from this origin at unchanged levels from the previous week. India also imports large amounts of base oils from Saudi Arabia, but shipments may see disruptions or longer lead times due to the need to reroute vessels through the Suez Canal.

Meanwhile, some offers from Southeast Asia have elicited keen interest from regional buyers. The key Thai producer was heard to have offered additional cargoes last week, which were swiftly snapped up. Flexibag volumes of SN150 were understood to have been offered at around $1,420/ton FCA Thailand, SN500 at $1,400/ton FCA and bright stock at $1,585/ton FCA Thailand, for September loading. The producer did not offer any cargoes this week. Offers from the refiner have been on and off during the last several weeks due to crude oil and feedstock supply concerns, particularly in view of the shipping turmoil in the Red Sea and ongoing Houthi rebel attacks on vessels and production facilities in Saudi Arabia.

There was limited availability from a second Thai producer, while an Indonesian refiner closed a tender on September 7 that involved small quantities of the Group I light grade for second half Sep. loading. Two small bright stock cargoes of Thai origin were also reported as having been secured by Chinese buyers for September shipment during the week.

Buying appetite for imports in China has been lackluster as buyers felt they could not offset the steeper prices by increasing lubricant values, as demand has not been robust and uncertainties lingered. Consumers preferred to purchase local products, and this incentivized producers to increase prices. Additionally, some buyers had delayed purchases for as long as possible and they have returned to the trading table to replenish stocks. Climbing crude oil prices and no prospects of a quick resolution to the Iran conflict also offered support to domestic prices.

One exception in terms of domestic prices may be bright stock, with a Chinese supplier having adjusted prices down to compete with imports, as they appeared to be plentiful since several bright stock cargoes from Southeast Asia had been imported in the previous two months. Indications from other producers were generally steady. The restart of Karamay Petrochemical’s plant in the second half of Sep. may bring more spot volumes to the market.

Group II

Group II base oil prices were exposed to downward pressure, despite the crude oil and feedstock price spikes. Lengthening supplies and slowing demand — with the exception, perhaps, of India — amid uncertainties in downstream markets continued to drag base oil prices down. Consumers were conservative in terms of acquiring products as they preferred to avoid keeping high inventories that may lose value in the coming weeks. The heavy-viscosity grades were more readily available than their light-vis counterparts and this was reflected in lower pricing.

The sole Taiwanese Group II producer was expected to be building inventories to cover contract commitments during a turnaround scheduled to start next month, with spot supplies likely to be more limited over the next couple of months. The shutdown was expected to start in mid-October and be completed in early December. Shipments to China from Taiwan were heard to have increased in August as contract customers seemed anxious to secure needed volumes as the producer’s shutdown was looming.

There have been some spot offers coming from the Taiwanese supplier in the last few weeks, but it could not be ascertained whether the supplier was sold out. The producer’s domestic list prices have remained unchanged in September, and its discounts for formula-linked accounts were rolled over into October.

The availability of Taiwanese material and of other imported cargoes has assuaged concerns about potential supply shortages in China. In fact, there was talk about cargoes  possibly being re-exported as demand was not strong enough to absorb imports and domestic supplies as well. The high premiums of imports were an added incentive to look for alternative markets for these cargoes.

Domestic suppliers have also increased posted prices given a pickup in demand as some buyers had depleted their stocks, and the steeper values may make arbitrage opportunities more difficult to work. At the same time, climbing crude oil and feedstock prices discouraged producers from offering discounts, particularly as there seemed to be fewer chances for the Iran conflict to be resolved quickly, keeping steady pressure on feedstock costs. An upcoming shutdown at a Group II plant in mid-November may reduce availability in the coming months as well.

Asian suppliers whose inventories have grown in recent weeks have set their sights on India, and have lowered their offer levels to entice Indian buyers. With the exception of the Group II 70N, which was heard to have inched up by $20-30/ton CFR India on firming feedstock costs, Group II import prices have slipped by around $20/ton on a CFR India basis. Blenders were expected to replenish stocks as these have been run down over the previous months given subdued buying activity during the monsoon season.

The improved amounts of imported heavy-viscosity material was seen as a blessing at a time when domestic supplies in India have fallen due to refinery yields, which result in higher volumes of the light grades, and because one producer was focusing on producing more Group III grades, which offered firmer netbacks given a global supply scarcity of Group III cuts.

South Korean Group II offers were also heard to continue to attract attention at destinations in the Americas. However, high freight rates, long delivery times and difficulties in locating vessels to cover the long-distance routes, together with thinning premiums for imported products have made some of the transactions more challenging to complete. The softer conditions in deep-sea markets would allow for more barrels to become available to Asian buyers in the coming weeks.

Aside from the current shipping disruptions, Group II availability from Saudi Arabia may be restricted because of a 30-day shutdown at the Saudi plant in Yanbu from October 1.

Group III

Persistent global Group III supply shortages kept upward presure on prices, but producers have found increasing resistance to further steep price hikes, and the amounts of the increases were more moderate compared to the previous weeks.

Blenders were concerned about demand in downstream lubricant markets amid economic uncertainties and manufacturers’ credit and cash constraints, which may make it difficult to transfer the high base oil costs down the supply chain.

With Iran still effectively controlling the Strait of Hormuz, Group III production in Abu Dhabi, Bahrain and Qatar continued to remain shut down and this kept pressuring prices. Increased turmoil surrounding crude oil shipments from Saudi Arabia and attacks on vessels in the Red Sea only added uncertainty to the base oil supply situation.

Unplanned outages in Europe and current and upcoming turnarounds in other regions were expected to exacerbate the product shortages. The joint venture production site operated by Repsol/SK Enmove in Spain has shut down 4 cSt production and supplies were not expected to recover until November, although the 6 cSt and 8 cSt cuts seemed more plentiful, not only in Spain, but in other regions as well.

A Malaysian Group III producer was understood to have scheduled a 45-day turnaround at its plant in Malacca that started in the second half of August and was expected to be completed in early October. The producer may have restricted spot offers as it was focusing on meeting term commitments during the outage, and it has also slightly curtailed allocations, according to sources, but no updates could be obtained from the producer directly.

In China, offers of imported Group III hovered at steeper levels than domestic supplies, limiting buying interest. A number of domestic producers were focusing on Group III production to the detriment of Group II cuts because of the more attractive prices of Group III grades. However, there were many lubricant manufacturers who had no choice but to accept the current import prices because of formulation requirements.

The Chinese coal-to-liquids (CTL) producer was heard to have started a 25-day turnaround in early September and has therefore restricted spot sales, even though the shutdown was only partial, according to reports.

Asian Group III suppliers were eyeing markets where netbacks were more attractive, reducing supply options for Chinese buyers. Chinese buyers were resisting the higher prices of imported products, because of uncertainties related to being able to recover the high costs from lubricant sales.

In India, the key Indian Group II/Group III producer was understood to be running its Group III production lines at top rates to take advantage of export opportunities given the supply vacuum left by Middle Eastern Group III base oils, with cargoes moving to overseas destinations including the U.S., according to sources. This has limited its Group II availability too.

Group III 4 cSt, 6 cSt and 8 cSt import prices edged up by $20/ton on a CFR India basis reflecting international prices amid ongoing supply shortages, but the price ascent seemed to have slowed down compared to previous weeks. Buying interest was somewhat subdued as blenders were not sure that they would be able to recoup costs by increasing lubricant prices, and many preferred to source domestic products whenever they became available. Some consumers continued to procure Group II base oils to replace Group III grades if formulations allowed.

Shipping

A number of base oil cargoes were discussed during the week:

• 2,000-ton parcel mentioned for shipment from Shanghai, China, to Mumbai, India, in the first half of September.
• About 2,500 tons expected to be shipped from Ulsan, South Korea, to India between Sep. 20-25
• Approximately 20,000-30,000 tons discussed for shipment from South Korea to West Coast India between October 10-20.
• About 30,000 metric tons also quoted for shipment from Yeosu or Ulsan, South Korea, to West Coast India between Oct. 10-20
• 3,000-4,000-ton parcel quoted for shipment from Port Klang and Malacca, Malaysia, to Genoa, Italy, between Sep. 10-20.
• 5,000-ton cargo on the table for shipment from Tianjin, China, to Mumbai between Sep. 20-25.
• Approximately 10,000-20,000 tons discussed for loading in Daesan or Pyeongtaek, South Korea, to Mumbai at the end of Sep.
• 6,000-ton cargo mentioned for lifting in Yeosu to Merak, Indonesia, in the first week of Oct.
• 1,600-ton parcel on the table for shipment from Yeosu to Yokohama, Japan, between Sep. 29-Oct. 6.
• 2,000-ton cargo expected to be shipped from Sriracha, Thailand, to Singapore on Sept. 10-15.
• 2,000-ton lot also mentioned for shipment from Nantong, China, to Port Klang, in mid-Sep.
• 6,000-ton parcel quoted for shipment from Rayong, Thailand, to Lagos, Nigeria, in September.
• 4,000-ton cargo discussed for lifting in South Korea to the U.S. Gulf in September.
• About 7,000 tons mentioned for possible loading in South Korea to East Coast South America in September.

Production

Middle East Plants
Qatar Energy halted production of liquid natural gas and other products following drone attacks on its facilities in Ras Laffan and Mesaieed in early March. The facility will not be able to return to normal production for several months, and has declared force majeure on LNG shipments, according to the company’s website. One train at the Shell/Qatar Petroleum Pearl gas-to-liquids base oil unit in Ras Laffan, which suffered some damage during an attack as well, was heard to be shut down. The unit utilizes natural gas from the Qatar Energy refinery to produce Group III base oils. The plant has a nameplate capacity of 1,372,000 tons of Group II/Group III base stocks. The damaged train was expected to remain shut down for several months, possibly a year, until repairs to the highly specialized equipment are completed.

Fire erupted at Bapco’s refinery in Maameer, Bahrain, on March 5 following an Iranian attack. The country’s Ministry of Interior reported that the fire had been brought under control without providing further details about potential damages. Bapco operates a 400,000-metric tons per year Group III base oil facility in Sitra, within the Bapco refinery complex. Sources familiar with the plant’s operations said that Group III production was unaffected by the fire, but some reports indicated that production had stopped for damage assessments. An official report was not available by the publishing deadline.

In Abu Dhabi, United Arab Emirates, a suspected drone strike had triggered a fire at the Ruwais Industrial Complex, leading authorities to shut down the country’s flagship refinery as a precautionary measure on March 10. The Ruwais complex houses ADNOC’s Group II and Group III base oils plant. According to sources familiar with ADNOC’s operations, the base oil unit was not damaged during the drone attack as only one train of the refinery had been affected by the strike, although it was reportedly running at reduced rates. The producer appeared to have been able to maintain base oils output for its own downstream lubricant operations. The latest information indicates that ADNOC was preparing to ramp up production following news of a ceasefire in the Middle East in late June, although these plans have been derailed by a resumption in hostilities and renewed closing of the Strait of Hormuz on July 8. The distributor of ADNOC material in the U.S. was compelled to declare force majeure on contract shipments as no fresh base oil cargoes have been able to be lifted in Abu Dhabi.

The latest plant turnaround information for 2026 is provided below, along with plant shutdowns that took place in the second half of 2025 as they may have impacted base oil pricing at the time of completion and beyond.

Group I

• Luberef postponed a 30-day turnaround at its Group I/Group II plant in Yanbu, Saudi Arabia, from August to October 2026. The shutdown will only affect Group II production, according to sources. The company had previously completed maintenance at the unit from mid-November until December 2025.
• Luberef has secured a new feedstock supply agreement for the company’s Jeddah facility. The facility had been expected to close by mid-2026, but the new supply agreement will allow it to continue operations beyond 2026. As a result, the company will maintain its current production capacity of 275,000 tons per year of Group I base oils. With the completion of the Growth-II Project in Yanbu, Luberef’s total production capacity will reach 1.53 million tons per year, making it the only supplier in the region able to offer Group I, Group II, and Group III base oils.
• PetroChina Karamay started a turnaround at its Group I/Group II and naphthenic base oils plant in Xinjiang, China, in August that will last two months.
• CNOOC Taizhou started a turnaround at its Group I/II plant in Jiangsu, China, in mid-April that was expected to have been completed in mid-June.
• Petrochina Fushun completed a turnaround in May at its Group I plant in Fushun, China.
• Idemitsu started a scheduled turnaround at its Group I plant in Chiba, Japan, in mid-May that lasted until July. The company secures Group III base oils required for its high-performance and eco-friendly engine lubricants through a partnership and a memorandum of understanding with Luberef.
• Eneos’ plant in Kainan, Japan, suffered an unplanned shutdown in February 2026. The company’s Mizushima A plant underwent maintenance from October to November 2025.
• Two Eneos Group I plants were permanently closed in Japan in recent years.
• Pertamina reportedly completed a one-month turnaround at its Group I plant in Cilacap, Indonesia, in April 2026.
• PetroChina’s Dalian refinery began a permanent shutdown in 2023. The base oils unit closed in late 2024, with full closure completed in July 2025. Inventory clearance was scheduled by end of August 2025.
• CNPC’s Fushun plant in Liaoning was expected to increase Group I production to offset the Dalian closure. Bright stock capacity is estimated at 60,000 t/y.

Group II

• Formosa Petrochemical unexpectedly shut down its Group II base oils plant in Mailiao, Taiwan, in early July due to feedstock supply issues given technical problems at the affiliated refinery, but restarted production the second week of July. Some shipments suffered small delays. Formosa has postponed a scheduled turnaround and catalyst change from the fourth quarter of 2025 to mid-October 2026. The shutdown was expected to last until early December.
• Petronas was heard to have postponed a turnaround at its Group II/III Melaka plant in Malaysia from June to the second half of August 2026, with a restart expected at the end of September.
• PetroChina Karamay was expected to start a turnaround at its Group I/Group II and naphthenic base oils plant in Xinjiang, China, in August that will last two months.
• State-owned Sinopec Jingmen Co. plans to have a turnaround at its plant in Jingmen City, China, in November 2026. It is the largest production plant for base oils and waxes in Central-South China.
• Hyundai Oilbank Shell Base Oils shut down its plant in Daesan, South Korea, in early April 2026 for approximately 45 days. The plant had run at reduced rates for several days in February due to a technical problem. The turnaround was completed around May 8 and spot shipments were expected to have resumed in June.
• GS Caltex shut down its Group II/Group III plant in Yeosu, South Korea, in early May to complete a month-long turnaround. The plant was restarted in June.
• CNOOC scheduled a turnaround at its Taizhou, China, plant in the second quarter of 2026.
• ExxonMobil completed a capacity expansion at its Singapore Resid Upgrade Project and commenced on-spec production in August 2025. The producer has started to offer an ultra-heavy Group II grade with similar characteristics to bright stock. The project is an upgrade of the company’s integrated manufacturing complex, which will allow it to expand large-scale production of its global EHC Group II slate and meet growing demand for high-performance lubricants in the Asia-Pacific region, the company said.
• Indian Oil Corp. was understood to have completed a one-month turnaround at its Group II plant in Haldia in November 2025. The producer also completed an expansion of its Group III capacity in Haldia in December 2025, and was expected to complete a Group II/Group III expansion at Gujarat in the third quarter of 2026.

Group III

• Petronas was heard to have postponed a turnaround at its Group II/III Melaka plant in Malaysia from June to the second half of August 2026, with a restart expected at the end of September.
• SK-Pertamina (Patra SK) completed a 40-day turnaround at its plant in Dumai, Indonesia, from early May to mid-June.
• In China, Shanxi Lu’an started a partial turnaround at its plant in Changzhi in late May and was expected to restart around June 22.
• Indian Oil Corp. completed an expansion of its Group III capacity in Haldia and a start-up of the expanded plant was achieved in December 2025.
• The restart of Shanxi Lu’an’s base oil plant following an unplanned shutdown in December 2025 was expected to bring more Group III supplies to the market in early 2026.

Prices

Crude Oil
Crude oil futures surged on Monday on growing concerns that energy supplies from the Middle East would be further diminished by a drone attack on a critical pipeline in Saudi Arabia, which was shut down over the weekend as a precautionary measure.

• Brent November futures were trading at $107.62 per barrel on September 14, up from $96.70/bbl for front-month futures on Sep. 7 (ICE Futures Europe).
• Dubai crude futures (Platts) for October 2026 settled at $100.20/bbl on Sep. 11, up from $89.94/bbl for front-month futures on Sep. 4 (CME).

Base Oils
Spot base oil prices in Asia were again mixed this week, with Group I remaining steady, Group II slipping and Group III prices increasing due to persistently tight fundamentals and regional shortages. Prices have been notionally adjusted to reflect current market conditions and sentiment, but trading continued to be limited and transactions remained difficult to track, especially for Group III grades, as there were hardly any spot volumes to be obtained.

The price assessments portrayed below reflect discussions, bids and offers, as well as deals and published prices widely regarded as benchmarks for the region.

Ex-tank Singapore

Group I
Solvent neutral 150 steady at $1,460/t-$1,500/t
SN500 assessed unchanged at $1,510/t-$1,550/t
Bright stock holding at $1,690-$1,730/t.

Group II
150N assessed down by $20/t at $1,650/t-$1,690/t
500N down by $20/t at $1,660/t-$1,700/t, all ex-tank Singapore.

FOB Asia

Group I
SN150 steady at $1,260/t-$1,300/t
SN500 holding at $1,280/t-$1,320/t

Bright stock prices unchanged at $1,460/t-$1,500/t

Group II
150N assessments down by $20/t at $1,530/t-$1,570/t
500N was also lower by $20/t at $1,560/t-$1,600/t

Group III
4 cSt moved up by $20/t to $3,620/t-$3,670/t
6 cSt increased by $20/t to $3,610/t-$3,660/t
8 cSt assessed up by $20/t as well at $3,460/t-$3,500/t

Gabriela Wheeler can be reached at gabriela@LubesnGreases.com

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