EMEA Base Oil Price Report


The war in Ukraine continues to dominate the news around the world, and is likewise making big impacts in a wide range of industries, including base oil markets where it is hampering availabilities and pushing up prices.

Prices are being driven higher on two fronts, the first being increases in crude oil and feedstock costs. The second is a squeeze in availabilities across the globe, which has some buyers struggling to cover requirements from usual sources.

The dearth of Russian export barrels coming out of the Baltic regions is having enormous drag on API Group l availabilities throughout Europe, and with a number of refineries cutting back on base oil production due to higher margins and faster cash flow input from fuels sales, the access to base oils is becoming a severe problem for the market. At the same time there are a number of planned turnarounds coming up in the next few months that will further shorten availabilities. 

Crude costs had fallen back below $110 per barrel during the latter days of last week, but surged again over the Easter weekend and early this week. It is very difficult to predict the direction and extent of crude prices at this time. Suffice to say that there are few signs currently of prices falling back to pre-invasion levels. 

Dated Brent crude oil is reported at $111.45/bbl for June front month settlement. West Texas Intermediate has also responded to demand, rising to post at $107.00/bbl, still for May front month. The WTI price is some $4 higher than two weeks ago, and the crack between the two marker crudes remains at around $4.

Oddly, low-sulfur gasoil has not risen but has stayed at around the same level as last reported – at $1,138 per metric ton, now for May settlement. These prices were obtained from London ICE trading late April 18.


Prices for Group I exports from Europe are purportedly continuing to rise against the background of rising feedstock prices and declining availabilities. With further restrictions coming on production due to turnarounds being carried out at three main producers, and increasing doubts as to whether a major source of Group l products in Italy will actually restart after maintenance, the market is bracing itself for severe shortages for the export trade. In essence there are no offers for large export requirements with most European Group l availabilities being placed into the domestic markets. 

Solvent neutral 150 values have moved quickly and markedly upwards, with an FOB basis price of $1,425 per ton price reported in the only deal confirmed to have been completed last week. The spread is pegged here at $1,425/t to $1,475/t. The SN500 price associated with the same transaction was put at $1,585/t, leaving this week’s spread at $1,585/t-$1,625/t. This cargo from the Mediterranean only contained 2,000 tons, indicating that availability of greater quantities may not be feasible.

Bright stock is generally unavailable in any quantity for export destinations, hence price indications are made on a purely nominal and hypothetical basis, using domestic numbers as a guide. The range would lie at $1,750/t-$1,825/t. 

A couple large cargoes might seem at first blush to be exports, but on closer examination these movements are major’s inter-affiliate trades and are not representative of true export deals.

Prices for base oil sales within Europe have rocketed over the last two weeks, and with there now being literally no export market, any prices associated from the export scene can be grouped together with those applying to the domestic markets. There is no longer wide variation between export and domestic prices since any available Group l product is being focused on domestic buyers.

The differential is now assessed at €10/t-€25/t, export prices being lower.

European Group II base oil prices are following the Group l domestic markets although sellers are honoring contracted business but are regularly revising prices as the ‘base oil lag’ kicks in to reflect higher raw material costs which are now impinging on current production. Prices have moved upwards and are expected to move higher still during this month. Producers are commenting that they are merely catching up with rising feedstock levels and are having to face further increases to maintain margins.  

The Group II base oil market in Europe has tightened considerably over the last month, perhaps partially as a result of scant avails in the Group l sector, but also because less products is coming to market from regions such as Far East and the U.S. where markets are under pressure to cover local demand rather than supply into export destinations. Spot sales are becoming rarer with buyers adopting contracted volumes rather than playing the field.

There are reports of feedstock limitations due to refiners diverting production away from base oils and waxes into using all available feedstock to produce optimum quantities of motor gasoline, jet and diesel.

Levels are pushed higher and are assessed between $1,720/t-$1,775/t (€1,592/t-€1,643/t) for 100 neutral, 150N and 220N and $1,920/t-$1,960/t (€1,777/t-€1,815/t) for 600N. These prices apply to a range of Group II oils from Europe, the United States, the Middle East and Asia-Pacific.

Group III prices continue to move higher with every replenishment cargo which arrives from the Far East and the Middle East Gulf. Production in Europe from Cartagena, Spain, and Porvoo, Finland, continues to service the fully approved part of the market, although when looking at the whole Group III scenario within Europe there are few differences between the two approval types.

For example, during April, some 45,000 tons of Group III grades will be shipped from Cartagena to a European hub in Rotterdam, and also to export destinations such as the West Coast of India. These large parcels are often in excess of 15,000 tons each and form a significant part of the total production from that source.

Any and all availabilities are being accepted by buyers, with contracted quantities looking at months in advance although suppliers and distributors reserve the right to adjust prices at any time.

So far there has been no allocation programs necessary, but some suppliers have given notice to buyers that should the Ukrainian situation worsen then quantities may become limited and retractions on contracted volumes may come into the market.

Prices in respect partly approved Group III base oils are moved higher this week, following upward moves from the late cargoes to arrive from outside the European mainland. Prices are now at €1,860/t-€1,880/t for 6 and 8 centiStoke and at €1,845/t-€1,865/t for 4 cSt, all on an FCA basis ex Amsterdam-Rotterdam-Antwerp and Northwestern Europe. Suppliers made comments last week which indicated that these prices would move again from mid-April with a number of cargoes moving from Middle East Gulf to European hubs.

Fully approved Group III base oils have been limited in price hikes by the slightly lower number applying to partly-approved grades. There is a differential, but this is nothing like some years back, with 4 cSt grades now at €1,955/t-€1,975/t and 6 and 8 cSt at €2.040/t-€2,065/t.

Baltic and Black Seas

Russian export barrels are not arriving in quantity from refineries. It is thought that the rail system is heavily committed to moving material from Russian sites to supporting troops in Ukraine. Also, financial problems are affecting the main rail operator in Russia, with defaults in bond repayments.

These issues may have a negative effect on operators’ ability to perform routine train transport. There are still cargoes planned for loading out of Kaliningrad, however, with one particularly large parcel of up to 20,000 tons touted for Singapore. This is a regular supply route from Svetly terminal and may form contracted business that has to be honored, even in these testing times.

One cargo was dispatched from Riga going into Antwerp-Rotterdam-Amsterdam, perhaps indicating that some supplies are getting through. This supply was originally sourced from a Gazprom refinery.

Re-refined cargoes are in demand out of Kalundborg, and these are being used as part substitute for Russian material by blenders in the United Kingdom. Quantities are limited, and production may not be able to satisfy all demand. Prices for these refined grade shave moved in tandem with domestic European numbers. Due to higher quality and specification, there are premia afforded to these grades over Baltic exports.

Using CFR prices landed into Dordrecht, and taking freight and margins into account, FOB levels are established with SN 150 assessed at $1,295/t-$1,335/t. SN 500 is indicated at $1,485/t-$1,555/t. There are no indications or availabilities for SN 900.

Turkish blenders struggled to procure sufficient quantities of Group l base oils, with sporadic supplies coming out of Izmir refinery, and financial and sourcing headaches regarding imports from Mediterranean suppliers. With Livorno refinery out of the loop, only Greek sources can supply seller quantities of Group l material for the Turkish market.

One such cargo of 2,000 tons of SN 150 and SN 500 was purchased last week from Greece on an FOB basis and will probably be shipped to Gebze for FCA sales to blenders in the region. Prices were heard at $1,425/t for the SN 150 with the SN 500 at $1,585/t. These were steep increases on anything else purchased recently.

The Tupras refinery at Izmir is now producing again, although availabilities are limited. Prices rose quickly after the restart a couple of weeks back, and there are limited reports that production was interrupted again during last week.

The situation in Turkey remains dire, with inflationary economics and restrictions on foreign currency purchases for importing energy products and foodstuffs.

Imported Group ll grades sold FCA moved sharply upwards after replenishment cargoes arrived and are now priced at €1,795-€1,845/t for the three lower vis products with 600N at €1,955/t-€1,980/t. There are fewer buyers looking to take supplies of these grades since they are unable to recoup costs in the finished lubricants being produced. Group lll base oils sold on the same FCA basis have levels in excess of €2,075/t -€2,100/t for partly approved grades, with fully approved Group lll grades from Spain at around €2,155/t -€2,185/t.

Middle East

Red Sea activity includes reports of several large cargoes moving to traditional receivers in the west coast of India, the United Arab Emirates and Pakistan. In addition to these large parcels, other cargoes of at 5,000-8,000 tons are moving into Aqaba, Egypt and Dar-es-Salaam.

No Iranian activity is noted in terms of export cargoes moving either to the west coast of India or to the U.A.E., although one of the main refiners, Sepahan, is represented at a base oil conference to be held in Dubai in the next few days. Suggestions are that most of Iranian base oil production is harnessed into local markets, avoiding export cargoes at this time.

Domestic usage is prioritized because few imported cargoes of base oil find their way into the Iranian market.

A number of smaller cargoes are moving into the U.A.E. from Singapore and Thailand with quantities of Group l base stocks, perhaps reflecting that Europe can no longer be considered a source for Group l material.

Group lll exports are noted, with a Stasco cargo loading out of Ras Laffan with quantities of gas-to-liquid produced Group lll+ base stocks, while on the same ship topping off with supplies of Group lll partly-approved material from Sitra refinery. Shell are the holders of the franchise to sell Sitra product into Europe and the U.S., this cargo moving to the U.S. Gulf and loading in May

Other movements feature cargoes loading out of Al Ruwais at the end of April for ARA for European distribution and another parcel of 9,500 tons loading out of Sitra for Hamriyah and Mumbai anchorage. 

Netbacks for Group lll base oils loading out of Al Ruwais and Sitra are revised upwards. The relative cost allocations from producers are not known to this report, therefore it can only be assumed that incremental costs are covered at source. Netbacks are assessed at $2,195/t-$2,265/t, for the range of 4 centiStoke, 6 cSt and 8 cSt partly-approved Group lll base oils.

“Nexbase” grades from Sitra refinery in Bahrain, going into the Chinese and Indian markets, will produce similar netback numbers because of lower margin sales in those markets. Netbacks are maintained at $2,195/t-$2,275/t for the range of Group lll grades.

Netback levels are based on prices derived and informally assessed from regional selling levels, less marketing, handling and estimated freight costs.

Group ll base oils from storage in Middle East Gulf, supplied from Far East and Red Sea sources, are resold on an FCA ex-tank, or on a delivered basis within the Middle East Gulf. Prices are increased to $1,785/t-$1,835/t for the light vis grades, with 500N and 600N at $1,925/t-$1,960/t.


South African reports indicate that an exceptionally large cargo of up to 30,000 tons in total loaded out of Rotterdam and Fawley, discharging into Durban, and thereafter the balance of the cargo into Mombasa. Another possibility is an 8,000-ton parcel coming out of the U.S. Gulf, also marked for Durban, although this cargo has yet to be confirmed. Two other smaller cargoes are to load out of Fawley for Durban, with another loading for receivers in Dakar. These are standalone cargoes, which is unusual for this type of supply.

West African news centers around another 18,000-ton Group l cargo loading out of the U.S. Gulf Coast and covering demand in Senegal and then moving the majority of the cargo into Apapa. An interesting shipping inquiry also came on the market, indicating that there could be a possibility to load 10,000 tons of Group l material from an eastern Mediterranean source. This could be another bright stock parcel from Egypt, but there are no clues at this point as to where the source of this material would lie. The possibility for 10,000 tons of bright stock is remote.

The availability out of Algeria appears to have been re-routed to Rotterdam rather than looking at the Nigerian market.

Prices are maintained since deals were completed for the cargoes on the high seas and were to be loaded on a prompt basis some time back. Numbers were confirmed to this report two weeks ago in reference to those shipments.

CIF/CFR prices remain as previously reported, with levels at $1,425/t -$1,445/t for SN 150, quantities of SN 500 are accepted at $1,495/t -$1,525/t, SN 900 is priced at $1,635/t-$1,655/t, with quantities of good quality bright stock at $1,795/t-$1,825/t. Looking at further cargoes and the revised U.S. Gulf and European FOB numbers, these cargoes will have price premia at $150/t-$200/t added to the levels above.

Ray Masson is director of Pumacrown Ltd., a trader and broker of petroleum products in London, U.K. Contact him directly at pumacrown@email.com.

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: https://www.lubesngreases.com/category/base-stocks/other/base-oil-pricing-report/

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