EMEA Base Oil Price Report


As we approach the end of August, there are some signs of a trickle of players making their way back to their offices and desks from the start of this week. Next week could see a flood of activity as people return from vacation and start the process of inventory replenishment, stocks in many cases having run down to bare minima prior to the holiday season kicking off at the end of July.

Those buyers looking to obtain supplies of API Group I grades will have been rewarded with ample availabilities around the markets and also much lower prices than were seen in July. Forecasts are that Group I availability could improve further.

Group II and Group III base oils were further hit by the euro falling to below parity this week, as the dire economic situation begins to bite across Europe. This is causing recessions to appear in many countries, which are facing inflationary pressures like they have not been seen in the last fifty years.

Some pundits project that inflation could reach 18% in some of the main economies such as Germany, France and the United Kingdom, figures which are frightening at best. In addition, the euro’s value is falling, a trend that could weigh against easing crude oil costs and the downward pressure that that tends to exert on base oil values, at least for transactions priced in euros.

Across Europe labor relations between employees and boards of directors are not at their best, with many unions calling workers to take strike action on the basis that wage offers are not keeping pace with inflation. There are planned disputes by truck drivers in Spain and talks of discontent in many industrial plants across France, Italy and Greece. These actions, while not all directly affecting the base oil scene, will have an impact across many industries, perhaps causing further economic grief in months to come.

Meanwhile, the Russian incursion into Ukraine is certainly not helping matters, with energy sanctions starting to take their toll across Europe. This means that shortages in supply could impact through the winter, with prices for gas moving ever higher, impinging on living costs and wages.

Ultimate demand for base oils and finished lubricants may only be assessed once into the fourth quarter, after some forecasts of recovery in certain key markets were announced late last week from economists, although the overall outlook and consensus is one “which will get worse before it gets better.”

Crude prices eased in early trading this week with Dated Brent marginally above $93 per barrel, having lost a couple of dollars since last reported. This crude currently posts at $93.05/bbl, this price still for October front month. WTI also marked lower, with levels at $87.20 per bbl. This price moved to October front month.

Low sulfur gas oil had moved lower but has staged what is termed “a temporary recovery in demand,” causing prices to rise to $1,095 per metric ton. This level is around $150/t higher than last posted. This product remains a bell-weather grade as to how demand and availability will pan out over the coming months. The price is now for September front month.

Prices were obtained from late London ICE trading on Aug. 22.


European Group I export prices are seeing softer numbers, with greater availability and more options for traders and buyers to looking for larger quantities of all grades. These options are important because cargo freight rates rallied greatly during the summer period and are at all time highs for shipments to export destinations such as West Africa, South Africa, the Middle East Gulf and India. Refiners are stating that inventories are not overly high, since many refineries have been concentrating at least on optimizing fuels production rather than derivatives such as base oil, waxes and bitumen.

FOB prices for SN 150 are assessed weaker than last posted and are now established at $1,295/t-$1,340/t, with SN 500 prices also lower, at $1,375/t-$1,420/t. Availability for bright stock has improved with almost all producers of this grade looking to move considerable quantities during September. To this end some sellers are prepared to offer “special” discounted prices, with numbers ranging between $1,485/t and $1,545/t.

Prices contained in offers are for prompt barrels either to load at the end of August or early September. Offers are also being prepared for forward barrels that will become available into September and beyond, allowing traders to plan cargoes and offers for receivers in Nigeria and the Middle East Gulf. It is not considered that heavier buying activity will promote prices to rise, since with fundamentals coming lower in pricing terms, pressure is on sellers to maintain margins as best as possible.  

European domestic base oil markets for Group I base oils are starting to make a comeback in activity terms, but it remains to be seen where prices go. Producers and refiners are making the case that it is a little early for base oil prices to fully reflect easier crude and feedstock levels, and that relative prices may only start to appear towards the second half or September. Buyers are making their case that crude and feedstock have come off the latest highs for some time now, and some movement in base oil prices can be justified for sales made in U.S. dollars.

Most European Union domestic trade is conducted in euros, and the exchange rate may support prices remaining higher for domestic markets. Whereas export sales are all made in dollars, hence lower prices can be expected for these trades. Domestic buyers do see export numbers and are quick to point out alignment with the lower values.

Domestic levels may be buoyed by falling euro exchange rates, although it is expected that sellers will make efforts to bring a more competitive aspect to this part of the base oil market. The differential is assessed going forward at €85/t-€140/t.

Group II base oil prices are showing resilience to falling. With Group I export and domestic prices, however, demand is returning to this market sector, producing a balance in supply and availability. Group II is predominantly sold in euros around EU countries, causing similar exchange rate problems as Group I domestic levels. Some sellers have been inclined to make small downward shifts to selected customers, hence numbers are adjusted into wider ranges for September sales. There are also talks of material coming on to the European market from Asia-Pacific sources, with one large import into Antwerp-Rotterdam-Amsterdam from a South Korean source. These imports will avoid any duty element that would be paid on U.S. imports of Group II base oils.

The exchange rate is certainly the driver in maintaining prices at higher levels. But there are some reports of lower levels for September, these being finalized during the next few days. There are also pressures building from the dips in Group I prices, which are always a possible negotiating tool for buyers of Group II base oils.

Prices are tweaked slightly lower, but with the exchange rate movements there is an element of support to maintain euro prices, Prices are assessed at $1,775-$1,830/t (€1,780-€1,835) for the three light vis grades – 100N, 150N and 220N – with 600N now at $1,915/t-$1,955/t (€1,922/t-€1,962/t). Please note that with the euro going to less than parity against the dollar, the latter prices are now higher. 

Prices are for a range of Group II base oils, including European, U.S. and Asia-Pacific grades. Possible imports may also arrive from a Middle East source.

Group III base oil prices are steady, with a few small adjustments made for September sales. With a large-scale turnaround about to start in the next few days, there is a possibility that availabilities of fully approved Group III base stocks could shorten up. However, market reports say that all contracted customers will receive full requirements of all grades, with stocks put into place to cover any potential production shortfall.

There still exists a shortfall in the availability of 4 centiStoke grades throughout Europe, whether this has been directly caused by the cessation of imports from a Russian producer is not entirely clear, with some players stating that demand for 4 cSt has simply outstripped that for 6 cSt and 8 cSt grades.

Reports were heard, but not confirmed, that full approvals that were due to expire over the next few months will now be retained by the new supplier of these grades from a Finnish refiner, and also that a current allocation of some 145,000 tons per annum from Sitra, Bahrain will also be taken up by the new supplier, thus increasing the flexibility to continue supplying into markets such as India and China.

Current prices for partly-approved Group III base oils are adjusted slightly lower, with levels now at €1,910/t-€1,955/t. The 6 cSt and 8 cSt grades are in the €1,915/t-€1,955/t range, with 4 cSt base oils at €1,910/t-€1,935/t. Prices are for FCA supplies from Antwerp-Rotterdam-Amsterdam and northwest Europe. There are rumors that prices for 4 cSt avails were hiked higher than numbers for 6 cSt and 8 cSt, but this was not verified to be the case in all instances.

Fully approved Group III base oil prices are also marginally adjusted going into September, with some small downward changes. While 4 cSt grades are placed at €1,950/t-€1,985/t, 6 cSt and 8 cSt oils are at €1,965/t-€2,010/t.

Baltic and Black Seas

Baltic Sea trading has been almost eradicated, with the EU sanctions going into force for any Russian exports of base oil handled into mainstream European ports. The countries joining in the EU ban include the United Kingdom, Switzerland, Norway and Sweden. Baltic Sea activity has been primarily confined to exports from Poland through Gdansk refinery and also the continuing supplies of Russian barrels from the Lukoil facility at Svetly in Kaliningrad. Lukoil also managed to extract Russian barrels from storage in Riga, adding to the exports that this company has made to Turkey, South America and Singapore.

Supplies of Group I base oils from Gdansk included a cargo of 4,500 tons currently loading and moving to Marmara in Turkey, and also a 5,000-ton parcel that will load in early September for receivers in Brownsville, Texas

The continued movement of base oils through both Latvia and Lithuania is still evident, with the latter taking supplies into Kaliningrad. There are no reports of any Baltic cargoes moving into Antwerp-Rotterdam-Amsterdam that could have been continued under the contract rules that come to an end next February, but there are no indications of shipping inquiries for such cargoes. There are a number of inquiries from receivers in Mexico and Argentina for Russian export barrels of Group I base oils, but it is unclear what prices are being applied to these cargoes because offers are made on a CIF basis. This will include freight and margins; therefore, FOB Baltic prices are hard to establish

FOB Baltic prices are mentioned on an ad hoc basis only and are given as indications rather than firm numbers. SN 150 is indicated at $1,260/t-$1,285/t, with SN 500 also indicated at $1,345/t-$1,380/t. Indications for SN 900 would be around $1,425/t-$1,455/t.

The Black Sea and Eastern Mediterranean region reports that Russian base oils continue to load out of Volgograd refinery and are then taken via the river Volga by sea-going barges, which can cross the Black Sea to Limas terminal in Turkey. The base oils are stored and then re-loaded, with such a cargo of around 10,000 tons having moved from Limas terminal to Hamriyah port in Sharjah. This is the second large parcel supplied to buyers in the U.A.E. The cargo was again sold on a CIF basis; therefore, the Limas FOB pricing can only be taken as an indication, with SN 150 and SN 500 grades delivered. Numbers are expected to range around $1,225/t-$1,250/t for the SN 150, with SN 500 at $1,385/t-$1,400/t, FOB Limas terminal.

Turkish blenders are also buying material from the same source but are hampered by the lack of U.S. dollars available for opening letters of credit to supplier Lukoil, who would not offer material on open credit into Turkey. The Turkish economy continues to slide, with rampant inflation at the highest level seen in any Western country. Some reports are of figures close to 200% for some goods and services, although the official government numbers are closer to 70%.

In addition to the Russian exports, Turkish blenders are taking Iranian and Uzbek base oils, some of which are trucked cross border into Turkey. It is rumored that payment for these supplies is often made in dirhams, the U.A.E. currency, which can be accessed through contacts in Dubai and Sharjah.

Tupras, the Turkish refiner, still is not producing base oils at the Izmir plant, which has stopped production on a number of occasions over the past couple of years. It is not certain why these almost regular stoppages occur. It may be lack of suitable feedstock or it may be equipment failure in the base oil train.

A small parcel of around 2,000 tons loaded out of Mersin for receivers in Israel. This material could be a bright stock feed from Tupras, sold as an export for dollars.

A major loading from either Augusta or from a storage hub in Valencia delivered a cargo of Group I base oils into Gemlik and Gebze ports. Turkish receivers are intent on taking material from Livorno and/or Aghio in September. Targeted CIF levels from buyers for SN150 and SN 500 and 600 are around $1,350/t for SN 150, with SN 500 around $1,485/t CIF Gebze.

Imported Group II grades supplied FCA Turkish storage by traders or distributors are taken a shade lower this week, with September pricing considered to be made more competitive with Group II grades coming into Gebze from Yanbu refinery. The parcel of 2,000 tons will load this week and will be delivered around mid-September. Prices ex-tank are reckoned to be at €1,910/t-€1,955/t for the three lower vis products, with 600N at €2,025/t-€2,095/t. Group III base oils sold on the same FCA basis, for partly approved grades, are maintained at €2,135/t-€2,175/t. Fully approved Group III grades from Spain are expected to be sold FCA at around €2,200/t-€2,275/t.

Middle East

Red Sea traffic shows a couple of cargoes loading out of Yanbu going to interesting locations. In addition to the Turkish parcel mentioned above, a cargo of 5,000 tons of one base oil grade will move to Houston, in the U.S. Gulf. This grade may be one Group I grade, such as bright stock. Another inquiry is for a smaller parcel of around 1,500 tons to discharge into Antwerp-Rotterdam-Amsterdam. This is thought to consist of Group II grades sold to a single receiver in Antwerp-Rotterdam-Amsterdam.

Middle East Gulf receivers are looking to take in the cargo from Lukoil, which has loaded out of the terminal in Turkey. The 10,000-ton parcel should reach Hamriyah during the second half of September. But no more word has been gleaned regarding the cargo of 12,000 tons that loaded in Hamriyah for receivers in La Plata in Argentina. This was a large parcel of what was considered to be Iranian SN 150 and SN 500+ from Sepahan refinery. Buyers in Hamriyah have already taken 6,000 tons of Russian export barrels, and the next 10,000-ton cargo will be the second to move into this region.

A large 10,000-ton Group III base oil cargo for Europe loaded out of Al Ruwais. This will arrive into Dordrecht storage and will be distributed by Chemlube, the company acting as European distributor for Adnoc, the producer and refiner based in Abu Dhabi. Additionally, a further cargo of 5,000 tons will load from Sitra for Stasco and will go into Rotterdam storage; thereafter, the cargo will be distributed within Europe. Part of the loading will possibly come into the U.K. via a trader, for break-bulk sales to blenders within the U.K. Both cargoes will be comprised of 4 cSt, 6 cSt and 8 cSt Group III base oils.

Netbacks for Group III base oils out of Al Ruwais and Sitra are taken slightly lower. The netbacks are assessed at $2,155/t-$2,195/t, for the range of 4 cSt, 6 cSt and 8 cSt partly-approved Group III base oils.

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

Group II base oils resold on the basis of FCA U.A.E. are sourced from European, U.S., Asia-Pacific and Red Sea suppliers. These base oils are resold ex-tank, or on a delivered basis within the Middle East Gulf, most of the material remaining in the U.A.E. Prices are maintained at $1,825/t-$1,865/t for the light vis grades, with 500N and 600N at $1,955/t-$1,995/t.


South African shipping sources have confirmed that another large cargo of base oils and some chemicals will load from Rotterdam and Fawley as per normal. The cargo will comprise of a total of 21,000 tons of various grades.

The larger than usual cargo going into Tema in Ghana is confirmed as 9,000 tons of Group I base oils SN 150, SN 500 and bright stock. Normally, only 5,000 tons of three grades of Group I base oils goes into Tema as part of the Ghana tender, but extra storage is available to take the extra 4,000 tons.

Nigeria has two cargoes currently discharging in Apapa, the first out of Riga with 10,000 tons of Russian base oils, the other loading was out of a major’s facility in Rotterdam with 9,000 tons of Group I base oils.

The further 10,000-ton inquiry to load out of Svetly terminal does not appear to have been finalized. Some comments were received that receivers in Apapa were not keen to accept Russian exports. Although another source informed this report that there could be problems again with accessing dollars by local Nigerian banks, thus preventing or delaying the issuance of a letter of credit that is opened locally in Lagos by a Nigerian bank and is thereafter confirmed by a prime acceptable European bank.

Without any current new indications, CIF/CFR levels are maintained and are indicated at around $1,575/t-$1,620/t for quantities of SN 150, SN 500 is priced at around $1,685/t-$1,725/t, and SN 900 is assessed at $1,720/t-$1,755/t. As an indication, only bright stock may be landed at around $1,795/t C&F Apapa.

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.

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