Weekly Asia Base Oil Price Report

Crude oil futures rose more than 1% in Asian trading on Monday after president Trump reported that he had rejected an Iranian proposal to reopen the Strait of Hormuz and end fighting in the Middle East. Brent crude futures jumped to above $106 per barrel, while WTI crude futures rose to around $93/bbl. The gap between Brent and West Texas Intermediate widened. According to experts, this was partly because of a potential 90-day ban on U.S. diesel exports to rein in prices, which fanned concerns that U.S. refiners might cut runs and reduce oil purchases. Meanwhile, analysts kept an eye on U.S.-Iran negotiations, hoping for a deal where Iran would reopen the Strait of Hormuz in exchange for a rollback of the U.S. blockade and a lifting of sanctions on Iranian oil sales.

Group I

Group I base oil spot prices were stable-to-firm compared to last week, though spot trading has generally muted. This stagnation was driven by crude supply uncertainties linked to ongoing Houthi rebel threats against Saudi Arabian oil shipments. Asian manufacturers are increasingly anxious about looming crude shortages alongside surging oil and fuel costs. As gasoil/diesel prices climb, refiners may find it economically advantageous to prioritize fuel production over base oils. To manage this volatility, the majority of suppliers have halted large-scale spot offers until market conditions stabilize. While monthly term obligations have mostly been fulfilled so far, there are growing fears that these volumes could face cutbacks in the near future.

Despite the lack of readily available spot cargoes, buyers have been patiently waiting to jump into the market because they believed spot prices would come under downward pressure once crude supply restrictions were resolved. Some consumers had no choice but to accept the current offer levels because their inventories were close to depletion.

A key Thai producer offered some flexibag cargoes last week, which were swiftly snatched because of the absence of other regional offers. The producer offered a small cargo of solvent neutral 150 at $1,395 per metric ton; SN500 at $1,415/t; and bright stock at $1,585/t, all FCA Thailand for October loading. These prices show fluctuations from levels seen earlier this month, with flexibag volumes of SN150 having been offered at around $1,420/ton FCA Thailand at that time, SN500 at $1,400/t FCA and bright stock at the same price of $1,585/t FCA Thailand, for September loading. This week, the producer has not yet communicated its spot offers, but may do so mid-week.

Some participants worried that producers may not be coming to the market with fresh offers due to increased concerns about crude oil availability as the turmoil in the Middle East threatened shipments. This would coincide with a base oils and lubricant pickup in domestic demand as the heavy rain season or “green season” — generally runs from mid-May to October in Thailand— was coming to an end and activity was anticipated to improve. Producers wanted to ensure they would have enough stocks to cover not only domestic requirements, but also export obligations amid limited supplies.

A key Southeast Asian producer was heard to have increased Group I base oil prices into a number of accounts, effective September 21.

In China, activity was starting to slow down ahead of the Mid-Autumn Festival and National Day holidays between September 25 and October 7. Buying interest for imports remained languid because of firm prices, while domestic supplies appeared to be available at competitive levels. Domestic supplies of bright stock were being offered at slightly reduced prices because producers were eager to conclude business ahead of the holidays.

There were also expectations that domestic supplies would mount as a producer, Karamay Petrochemical, has completed a turnaround, and a second supplier lowered posted prices for bright stock, hoping to attract buying interest. Demand for this grade tends to decline during the fall/winter months. Several bright stock cargoes from Southeast Asia had been imported in the previous two months as well. Local producers were striving to reduce inventories and offered bright stock at significant discounts to imported material.

In India, domestic Group I prices were steady from the previous week, with plentiful domestic supplies assuaging concerns about potential supply disruptions from Saudi Arabia. Group I import shipments from Saudi Arabia could see delays as Saudi facilities and vessels came under intensified attacks by Houthi rebels over the last couple of weeks. Some shipments were heard to have been rerouted via the Suez Canal and around the Cape of Good Hope, which means they would take longer to arrive at destination. Demand was anticipated to gradually increase as the monsoon season was coming to an end, boosting industrial and transportation activities.

Domestic suppliers were making overtures towards raising base oil values given steep feedstock costs, but buyers may resist the adjustments as lubricant price increases were difficult to achieve.

Group II

Group II prices were mostly steady, with few fresh offers emerging as producers worried about securing crude oil cargoes from the Middle East. With Saudi Arabian producer Saudi Aramco having to restart its East-West pipeline and ongoing Houthi threats to crude oil and products shipments out of Yanbu, there were concerns that shipments would either be cancelled or rerouted, taking much longer to arrive and carrying much higher freight and insurance costs.

Refiners have been dealing with crude supply issues since the start of the Iran war, and while many have been able to source product from alternative origins, a larger supply crunch may again affect refinery run rates. Additionally, surging gasoil/diesel prices were also expected to impact refinery decisions regarding fuel production versus that of base oils.

Group II availability from Saudi Arabia may be restricted due to the current shipping disruptions and because of a 30-day shutdown at the Saudi plant in Yanbu that was expected to start on October 1, although sources indicated that the base oils plant had already started a partial shutdown.

Demand was sluggish in some Asian countries, and has strengthened in others, like India. Indian buyers have returned to the market as the end of the monsoon season approached, and domestic supplies of Group II grades were not ample. This was partly attributed to a key producer trying to manufacture more Group III grades because of higher margins and export opportunities, while it trimmed Group II output.

A number of Indian buyers were looking to replenish inventories as many had stayed away from the market during the monsoon months, but higher gasoil prices exerted upward pressure on import prices for the 70N grade, with values edging up by around $20/ton on a CFR India basis week on week. The 150N and 500N were largely unchanged from the previous week.

At the same time, there was not overwhelming availability of international cargoes as some suppliers have withheld offers on crude supply concerns. South Korean suppliers have also been able to reduce inventories by shipping products to faraway destinations in the Americas and Europe. It was also heard that a South Korean refiner had suspended spot offers given rising feedstock costs and crude supply disruptions.

An upcoming turnaround at the Group II plant of Formosa Petrochemical, the sole Taiwanese producer, might exacerbate the tight supply conditions until the end of the year. The shutdown was expected to start in mid-October and be completed in early December. The producer had built stocks ahead of the outage to cover contractual commitments, but was not expected to have much surplus spot product to offer.

In China, consumption has slowed down due to the start of the Mid-Autumn Festival and National Day holidays. Some buyers had replenished stocks ahead of the break because they were worried about availability upon their return to business. Indeed, regional offers were few and far between, and imports carried a steep premium compared to domestic products.

At the same time, some suppliers were eager to lower inventories, but export opportunities seemed to have dried up as demand for Chinese cargoes has weakened. A supplier was heard to have adjusted down its price expectations on a tender that included 150N volumes because it was hoping to finalize sales before the holiday period. It could not be confirmed whether the cargoes had been sold.

Grmup III

Group III prices continued to be exposed to strong upward pressure due to the supply disruptions in the Persian Gulf and damages to some facilities there. This week, the increases were significantly smaller compared to a few weeks ago because buyers have grown increasingly resistant to the steeper indications. Economic uncertainties — many prompted by the climbing energy costs–combined with buyers’ limited cash flow and tighter credit were dampening finished lubricant demand. Experts explained that unlike fuel, which is absolutely necessary to run machinery and vehicles, lubricant purchases can be delayed as long as possible, and consumption levels seemed to have slipped in many areas.

Iran maintained its grip on the Strait of Hormuz and a very limited number of vessels appeared to manage the crossing. But there was a glimmer of hope during the week as news emerged that the official distributor of Abu Dhabi producer Adnoc’s material in the U.S. had been able to lift products and sail a vessel through the Strait of Hormuz, with the 40,000 metric-ton cargo said to be on its way to the U.S. There were also rumblings that another vessel had loaded at the Bapco terminal in Sitra, although further details were not forthcoming, and that Shell Trading had also been able to ship product out of the Persian Gulf.

According to reports, the Adnoc distributor had informed customers that they would be receiving product in late October, but the company would be maintaining its force majeure on contract commitments that has been in place since July as arranging passage through the strait was still uncertain and risky, and while Iran controlled the Strait of Hormuz, there was no warranty that future shipments could be achieved. Freight and insurance rates were also astronomical, sources said.

Group III production in Abu Dhabi, Bahrain and Qatar remained mostly shut down, keeping upward pressure on prices. Escalating turmoil surrounding crude oil shipments from Saudi Arabia and attacks on vessels in the Red Sea intensified concerns about the slim likelihood of returning to normal conditions soon.

As mentioned last week, current and upcoming turnarounds in Asia and other regions were expected to exacerbate the product shortages.

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, although spot supplies were not likely to be available for some time. No confirmation could be obtained from the producer directly.

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.

In China, the domestic coal-to-liquids producer has raised prices because of tight availability, particularly of the 4 cSt cut. These prices were supported by a lack of import cargoes as regional spot supplies were almost non-existent. South Korean producers were alloting production to covering term obligations and had little extra product to offer. Even though domestic prices have inched up, they were still deemed more competitive than import prices. Demand was somewhat subdued due to the local holidays this week.

In India, the ongoing global supply shortages pushed Group III 4 cSt, 6 cSt and 8 cSt import prices up by almost $100/t on a CFR India basis. Some buyers had no choice but to secure these products because of product formulations. Those who were able to replace Group III base oils with Group II cuts did so because of the price advantage. The rest of the consumers tried to secure domestic supplies.

The 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 gap left by Middle Eastern Group III base oils, with cargoes being offered to overseas destinations including the U.S., according to sources.

Shipping

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

• 3,000-5,000 metric tons of base oils mentioned for possible shipment from South Korea to Brazil, October.
• 5,500-ton parcel under consideration for shipment from South Korea or China to Rio de Janeiro, Brazil, first half October.
• 20,000-ton lot quoted for shipment from Port Klang, Malaysia, to Savannah, U.S., Oct. 15-25.
• 4,000-ton cargo on the table for shipment from Mailiao, Taiwan, to Fujairah, UAE, late September.
• About 1,500 tons expected to be shipped from Onsan, South Korea, to Singapore, early October.
• 1,500-ton cargo discussed for shipment from Indonesia to China, Sept. 20-30.
• 3,000-ton lot quoted for possible lifting in Ulsan to Colombo, Sri Lanka, first half October.
• 30,000-40,000 tons discussed for shipment from Yeosu/Ulsan, South Korea, to West Coast India, Oct. 10-20.
• 6,000-ton parcel on the table for shipment from Rayong, Thailand, to Lagos/Apapa, Nigeria, late September.
• 6,000-ton lot expected to load in Yeosu, South Korea, to Merak, Indonesia, first week October.
• 6,000-8,000 tons quoted for shipment from Yanbu, Saudi Arabia, to West Coast India, on any September dates or early October.
• 10,000-ton cargo discussed for lifting in Southeast Asia to the U.S. Gulf, Oct. 5-15
• 1,600-ton parcel on the table for shipment from Yeosu to Yokohama, Japan, Sept. 29-Oct. 6.
• 600-ton cargo was quoted for shipment from Onsan to Taiwan, early October.

Production

Persian Gulf plants

Qatar Energy halted production of liquid natural gas (LNG) 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 metric 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. A partial shutdown had already started, according to market 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 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 (MOU) with Saudi Aramco Base Oil Company (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 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. The producer had 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.
• 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.
• 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 rose by more than one percent at the start of the week because of the continued impasse in U.S.-Iran talks. On Saturday, president Trump had openly rejected an Iranian proposal to reopen the Strait of Hormuz, but the Iranian foreign minister, Abbas Araghchi, held on to hopes that further discussions would take place in the coming days.

• Brent November futures were trading at $108.48 per barrel on September 28, up from $101.78/bbl for front-month futures on Sep. 21 (ICE Futures Europe).
• Dubai crude futures (Platts) for October 2026 settled at $100.46/bbl on Sep. 25, up from $99.08/bbl for front-month futures on Sep. 18 (CME).

Base Oils
Spot base oil prices in Asia were steady-to-firm this week, with Group I and Group II receiving support from a limited number of spot offers 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 higher by $10/t at $1,480/t-$1,520/t
SN500 also moved up by $10/t to $1,520/t-$1,560/t
Bright stock steady at $1,690-$1,730/t.

Group II
150N stable at $1,650/t-$1,690/t
500N also steady at $1,660/t-$1,700/t, all ex-tank Singapore.

FOB Asia

Group I

SN150 was assessed unchanged from the previous week at $1,280/t-$1,320/t
SN500 was holding at $1,300/t-$1,340/t
Bright stock prices were unchanged at $1,460/t-$1,500/t

Group II
150N assessments hovering at $1,530/t-$1,570/t
500N also steady at $1,560/t-$1,600/t

Group III
4 cSt grade moved up by $10/t at the low end of the range to $3,640/t-$3,680/t
6 cSt also increased by $10/t to $3,630/t-$3,680/t
8 cSt assessed up by $10/t as well at $3,470/t-$3,510/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.