Weekly Asia Base Oil Price Report

Authorities from New Delhi to Manila have implemented emergency measures to protect consumers from steep oil prices and mounting fuel shortages. Refiners currently have more limited access to crude oil, and fuel production is prioritized over other refined products, including base oils, resulting in reduced supplies. Countries such as Thailand have banned exports of energy products altogether. Base oil producers are focusing on trying to meet contract commitments, but several have suspended spot offers. Those who are still able to supply spot cargoes have adjusted prices up significantly.

The Iran war has also led to Iranian strikes on Middle East refineries, with at least a couple of them having had to declare force majeure on production. As reported last week, the Shell/Qatar Pearl GTL plant in Qatar and the Bapco plant in Bahrain both suffered production disruptions following drone attacks on the associated refineries, which supply feedstocks to the base oil plants. Additionally, a suspected drone strike triggered a fire at the Ruwais Industrial Complex in the United Arab Emirates, forcing authorities to shut down the country’s flagship refinery as a precautionary measure. The Ruwais complex houses a 12,300 barrels-per-day Group II and Group III plant.

Hundreds of tankers remain immobile in the Persian Gulf and vicinity, resulting in a reduced number of vessels available for transportation. This, together with increased insurance costs have sent freight rates to historic highs. There were reports of vessels being able to load in the Red Sea from the ports of Yanbu and Jeddah, Saudi Arabia, with a base oils cargo expected to load there in mid-March on its way to the Mediterranean and a second cargo headed to Singapore.

Further downstream, lubricant manufacturers expressed concern at the increase in production costs, given base oil price hikes and markups for other inputs, as well as transportation. The sharply higher crude oil prices have also reignited inflation worries in several nations, which could curb household spending and dampen demand for lubricants and finished products. Lubricant suppliers were starting to implement price increases so offset some of the escalating production costs.

Group I

While concluded spot transactions involving API Group I base stocks were few and far between, Group I prices have been notionally adjusted up to reflect the sharp jump in crude oil and feedstock prices and the limited spot availability. Most suppliers have withdrawn spot offers, prioritizing term commitments, while some buyers were looking for product, but did not indicate how much they were willing to pay to obtain product. Those who had enough inventories to run blending operations waited on the sidelines. The recent sharp climb in pricing was a shock to the system and it was difficult to figure out how or when the turmoil would be resolved, sources conceded.

The ongoing market uncertainties and the threat of feedstock supply shortages have prompted a majority of producers in Asia to suspend spot bulk offers altogether and to trim term allocations. Some suppliers were doing their utmost to meet contractual obligations in full, but others worried that inventories and output would not be enough to meet demand. The few sellers that had some spot availability worried that an offer today might not cover production costs tomorrow, given crude oil price volatility and climbing transportation costs. Furthermore, several ships were unable to leave ports or remained stuck in the Persian Gulf, restricting the number of vessels moving base oils, so logistical issues were also a problem.

In Indonesia, Pertamina has scheduled a turnaround at its Group I unit in Cilacap starting in April 2026. Some market sources speculated that the shutdown may commence slightly earlier because of the crude oil price hikes and supply disruptions, but this could not be confirmed. It was heard that Indonesian suppliers had withdrawn spot offers.

Thai producers suspended spot offers as well, but continued to meet contract commitments, although there were some restrictions on volumes.

The closing of the Strait of Hormuz and the cancellation of vessel movements by the main shipping operators have disrupted Group I and Group II base oil shipments from Asian suppliers that were en route to Middle East receivers. A number of cargoes moving to countries in the Persian Gulf have been diverted to India. This has relieved some of the price pressure in India, but it was also heard that Indian storage tanks were almost full and would not be able to hold too many additional supplies.

Even with the extra cargoes arriving in India, price indications have climbed significantly due to the supply disruptions and climbing feedstock costs. Domestic Indian producers were also concerned about their inability to meet requirements in full, particularly as they were supposed to prioritize fuel production over base oils. Despite U.S. sanctions on Russian crude oil exports, Indian refiners have been given the green light temporarily to secure Russian oil to run refining operations given the shortage of Middle East supplies.

Spot offer prices have climbed because of skyrocketing feedstock costs, steeper freight rates and potential supply shortages. Import prices for all Group I grades were heard to have jumped between $60-80/t on a CFR India basis. Competitively-priced Iranian Group I barrels that had been available to Indian buyers previously have been largely absent since the geopolitical tensions started.

This is all happening in India at a time when lubricant manufacturing typically reaches top production rates just before the end of the fiscal year on March 31. At the same time, concerns about the Middle East conflict and its effects on global economic growth rates may dampen consumer spending in India, and lead to reduced demand of base oils and lubricants. This was a concern not only in that country, but in many other nations of the region as well.

In China, prospects of limited or non-existent imports have driven Group I domestic prices up, as buyers turn to local producers for base oil cargoes, particularly of the heavy grades, which are less available from Chinese producers than the light grades. Bright stock prices have jumped as distributors’ stocks are limited and domestic inventories are being consumed while participants continue to monitor developments.

Group II

There was growing concern among Asian refiners that crude oil and feedstock supply shortages caused by the chokehold on shipments in the Strait of Hormuz and reduced oil production in the Middle East would force them to curtail production rates, particularly as governments were trying to ensure uninterrupted fuel supply for the general population.

In terms of base oils, producers for the most part have suspended export spot offers, and are reducing allocations to domestic term buyers. The lack of liquidity has caused spot prices to jump, with the reported spot numbers adjusted up to reflect notional indications, as spot trading was almost non-existent.

The sole Taiwanese Group II producer, Formosa Petrochemical, was also withholding spot offers, and was heard to be only entertaining term obligations. Formosa announced a price increase for domestic list prices during week–the third round since the beginning of the month–lifting prices for the 70N and 150N by New Taiwan Dollars (NT$) 3.89/liter, and the 500N by NT$3.35/l with an effective date of March 14. (NT$1.00  = US$0.03)

Spot offers from a couple of South Korean producers have been paused or limited as well as they need to increase fuels output. One of the South Korean refiners was heard to be curbing base oil production and increasing gasoil and gasoline output.

A second South Korean producer, Hyundai Oilbank/Shell, had already restricted spot offers two weeks ago as the producer was heard to be preparing inventories for an upcoming turnaround starting at the end of March, and it had also lowered run rates as it had suffered an unexpected production setback at its refinery last month.

In China, domestic prices have risen on the back of escalating import prices. A majority of buyers were seeking domestic supplies, but domestic values have also increased significantly because of crude oil price spikes, along with steep import prices, even though spot offers were very limited in number.

In India, the same situation as observed in other countries that rely heavily on imported base oils was present, with offers of Group II imports being restricted because most suppliers have suspended April offers.

Prices have moved up significantly to reflect the challenging fundamentals and increased feedstock costs. Import indications of Group II cuts were heard to have climbed by $70-80/t on a CFR India basis week-on-week, with many uncertainties still clouding prospects for the coming weeks. Domestic refiners were also anticipated to favor the production of gasoil as margins have improved substantially in detriment to base oil output.

Group III

The Group III segment was undoubtedly the most affected by the Middle East turmoil, as the region is one of the largest suppliers of Group III grades. While Group III trading in Asia has been tempered by the ongoing turmoil, prices have climbed significantly as not only Asian consumers, but also U.S. and European buyers were seeking Asian Group III supplies as cargoes from the Middle East have effectively disappeared from the market. Shipments out of Bahrain, Qatar and the United Arab Emirates have been blocked by the closure of the Strait of Hormuz along with the absence of vessels, since many are stranded in the Persian Gulf and Gulf of Oman, and ship operators have also cancelled vessel transit around the conflict.

Additionally, production was expected to have been disrupted in at least a couple of refineries that produce Group III base oils –Bapco and Shell/Qatar Petroleum Pearl GTL – because of drone strikes at associated refineries.

In China, domestic Group III prices have moved up in tandem with imported product prices as shipments from the Middle East are unable to reach Chinese consumers. Many have turned to domestic suppliers to avoid logistical issues and secure base stocks for the foreseeable future.

In India, Group III indications have also surged following supply disruptions from several suppliers, with some cargoes being unable to be loaded in the Middle East amid rising concerns about future shipments out of the region. As a result, import indications have moved up by substantial amounts, reflecting the steeper feedstock costs and strained availability. Prices on a CFR India basis were notionally adjusted up by $50-60/t, depending on the grade.

Spot prices on an FOB Asia basis have been notionally adjusted up to show the current price trend in Asia, but with market changes happening very fast, values could lose validity very quickly.

Shipping

A number of the following inquiries had emerged before the start of the U.S., Israel and Iran conflict, and some shipments will be completed, while others may be cancelled or delayed, depending on vessel availability and routing.

• A 3,400-ton parcel was on the table for lifting in Yeddah/Yanbu, Saudi Arabia, to Singapore in late March.
• A 2,000-ton cargo was discussed for shipment from Sriracha, Thailand, to India in the first half of April.
• A 4,000 to 5,000-ton lot was mentioned for shipment from Daesan/Pyongtaek, South Korea, to Hamriyah, United Arab Emirates, in first half April.
• A 4,000-ton lot was expected to be shipped from Mailiao, Taiwan, to West Coast India/Persian Gulf in late March.
• A 4,000-ton was mentioned to for shipment from Taiwan to Pakistan between March 10-15.
• A 1,100-ton cargo was discussed for shipment from Onsan, South Korea, to Bangkok, Thailand, between March 29-April 10.
• A 1,600-ton cargo was on the table for shipment from Onsan to Taichung, Taiwan, between March 24-31.

Production

Production at the base oil units of Bapco in Bahrain and Shell/Qatar Petroleum Pearl GTL in Qatar appeared to have been impacted by Iranian strikes on upstream facilities. There was no confirmation about the status of the Pearl GTL plant which receives feedstocks from Qatar Energy.

Qatar Energy halted production of liquid natural gas (LNG) and other products following drone attacks on its facilities in Ras Laffan and Mesaieed on March 3. The facility will not be able to return to normal production for at least a month, and has declared force majeure, according to the company’s website. While it could not be ascertained whether the Shell/Qatar Petroleum Pearl gas-to-liquids base oil unit in Ras Laffan had suffered any damages, base oil production may be curtailed or shut down as the unit utilizes natural gas from the 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 oils.

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. An official report was not available by the publishing deadline.

The latest plant turnaround information for 2026 is provided below, along with turnarounds 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

• 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 recent years.
• Luberef scheduled a 30-day turnaround at its Group I/Group II plant in Yanbu, Saudi Arabia, in August 2026. The company had previously completed maintenance at the unit from mid-November until December 2025. The plant underwent an expansion in 2017. 
• 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 t/y 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 t/y, making it the only supplier in the region able to offer Group I, Group II, and Group III base oils.
• Chennai Petroleum completed a turnaround at its Group I plant in Chennai, India, in September/October 2025 for approximately one month.
• Thai Lube Base Oil’s Group I unit in Sriracha, Thailand, was shut for 45 days from mid-July to second half August 2025.
• 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

• Hyundai Oilbank Shell Base Oils plans to shut down its plant in Daesan, South Korea, in late March/April 2026 for approximately 45 days.
• CNOOC has scheduled a turnaround at its Taizhou, China, plant in the second quarter of 2026.
• State-owned Sinopec Jingmen Co. plans to have a turnaround at its plant in Jingmen City, China, in November. It is the largest production plant for base oils and waxes in Central-South China.
• Formosa Petrochemical postponed a scheduled turnaround and catalyst change at its Mailiao, Taiwan, plant from the fourth quarter of 2025 to third 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.
• Excel Paralubes completed a scheduled turnaround at its Lake Charles, Louisiana, U.S. plant in October 2025. The plant had been running at reduced rates for most of the year, limiting spot availabilities in the U.S., but a catalyst change has allowed the company to maximize output.
• Motiva restarted operations in June 2025 after a three-week turnaround at its Port Arthur, Texas, U.S., hydrocracker beginning in late May. However, some production issues lingered for several more weeks, reducing the producer’s Group II inventories and tightening Group II spot availability in the second half of 2025.

Group III

• Pertamina-SK will be completing a 40-day turnaround at its plant in Dumai, Indonesia, in May 2026.
• Petronas plans to shut down its Group III Melaka plant in Malaysia for a turnaround in mid-2026.
• 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 should bring more Group III supplies to the market in early 2026.
• A fire at SK-Pertamina’s refinery in Dumai, Indonesia, broke out on October 1, 2025, but was quickly extinguished, with no impact to base oil supply reported. The Dumai Group III base oil plant was shut down for maintenance after the fire and was restarted shortly after. Term supplies were not expected to have been affected. Pertamina also operates a Group I plant in Cilacap, Indonesia. The Dumai refinery is a joint venture between Indonesian state-run Kilang Pertamina Internasional and South Korean producer SK Enmove.
• Sinopec restarted its Group III plant in Yanshan, China, in late July 2025.

Prices

Crude Oil

Brent futures surged over the weekend as the U.S. and Israel attacks on Iran show no sign of abating. Values jumped to $106 per barrel after having retreated during the week, despite the fact that the 32 countries that make up the International Energy Agency unanimously agreed to release a collective 400 million barrels of oil in the largest emergency release ever.

• Brent May 2026 futures were trading at $104.79 per barrel on March 16, 2026, down from $114.20/bbl for front-month futures on March 9 (ICE Futures Europe).
• Dubai crude futures (Platts) for April 2026 settled at $103.87/bbl on March 13, 2026, up from $86.96/bbl for front-month futures on March 6 (CME).

Base Oil
Spot base oil prices in Asia surged due to sharply higher feedstock and crude oil prices and tightening supplies. Prices have been notionally adjusted up to reflect current market conditions and sentiment in thin trading.

The price 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
Group I solvent neutral 150 assessed higher by $90 at $920/t-$960/t
SN500 was also up by $90/t at $980/t-$1,020/t
Bright stock prices edged up by $90/t as well to $1,400-$1,440/t 

Group II 150N adjusted up by $100/t to $980/t-$1,020/t
500N assessed up by $100/t as well at $1,020/t-$1,070/t

FOB Asia
Group I SN150 jumped by $150/t to $860/t-$900/t
SN500 also moved up by $150/t to $880/t-$920t
Bright stock prices assessed higher by $150/t at $1,270/t-$1,310/t

Group II 150N also increased by $150/t to $920/t-$960/t
500N higher by $150/t at $940/t-$980/t

Group III grades were also assessed up
4 cSt higher by $60/t at $1,190/t-$1,230/t
6 cSt up by $60/t at $1,150/t-$1,190/t
8 cSt higher by $60 at $990/t-$1,030/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.