EMEA Base Oil Price Report


Base oil markets around Europe, the Middle East and Africa are suffering from the same contagion as other industries – a number of the key economies teetering on the edge of recession, holding back trade and demand for commodities, including finished lubricants.

Industrial and process oils are seeing lower demand than in any year previously, even during the pandemic period when industry practically stood down for many months. The automotive sector offers a glimmer of hope for lubricant blenders, but the overall outlook is gloomy – especially in Europe.

Middle East Gulf and African markets are somewhat better off but are suffering negative impacts from the ongoing war in Ukraine as well as the situation in Sudan, which is close to civil war.

Base oil producers are damned if they move too far in the direction of optimizing base oils, which they have incentive to do since the premium to diesel has moved to its highest level in some years. The problem is that demand is fickle, and refiners could end up with large stocks of unsold base oils if lubricant demand sinks. Diesel margins are lower than during the past couple of years, but demand is still positive for European distillates, especially now that the European Union has banned imports from Russia.

The absence of Russian base oils has altered the European supply scene for API Group I oils. More deep-sea cargoes are arriving from distant sources in regions such as the Red Sea, India and the United States. Whereas European cargoes fed into the supply chains in India and Middle East Gulf, now the trading patterns have been reversed with arbitrages open for material from those areas.

It is nevertheless surprising that the European market is relatively short and supplying small amounts to export destinations such as West Africa and Central and South America. There appears to be easy availabilities for the domestic market, but producers are offering few barrels for export. Prices moved marginally higher for this month, and it will be interesting to see if upward pressure continues in coming months.

The line between surplus and shortage appears to be fine. Supply and demand are probably in balance at the moment, but it would not take much to upset this equilibrium and send Group I markets in one direction or the other.

Group II appears to be rather insulated from the vagaries of the Group I scene. Demand for the former is holding firm, with a number of blending operations tweaking formulations to use as much Group II as possible rather than moving to Group III, as prices for that category remain high. The delta between Group II and Group III has never been greater, even after recent Group II markups. The average differential is $500/t-$700 per metric ton, incentivizing blenders to max out on Group II wherever possible.

Crude prices changed little the past week. Demand has not kept up with forecasts because economies such as China and India are consuming less than expected. Dated deliveries of Brent crude are currently at $75.30 per barrel, for July front month settlement, with West Texas Intermediate crude moving lower to $71.15/bbl, still for June front month.

Low-sulfur gas oil changed little since last week and are at $679 per ton, now for June front month. These prices were all gathered from London ICE trading late May 15.


There is little discernible activity for Group I exports from Europe. No deals were reported the past week for true export destinations, though a few small cargoes crossed the Mediterranean to locations such as Egypt, Morocco and Turkey. Some of these are regular deliveries under ongoing contracts.

There is a distinct lack of interest in traders taking European barrels to markets such as Nigeria and other parts of West Africa. The truth is that not many suppliers have the requisite quantities to offer for larger cargoes, so traders are looking to alternative sources – for example in the U.S.

Turkey has gone extremely quiet in the lead-up to its presidential election and now as it prepares for a run-off. Buyers appear to have put off purchasing notable quantities until the matter is settled. The run-off is scheduled for May 28.

Prices for Group I exports from Europe are unchanged at between $1,020/t and $1,055/t for solvent neutral 150 and $1,085/t-$1,140/t for SN500 and SN600, all on an FOB basis. No new offers for bright stock were heard this week, so prices are left at $1,295/t-$1,345/t, as reported last week, though neither of the offers heard last week was taken up by traders.

Group I trading within Europe was steady during the first half of May. With crude and feedstock costs stable, there does not appear to be pressure on prices, so a calm summer could be in store if no major disruptions crop up. A number of European refineries are in the midst of or preparing to begin maintenance turnarounds.

Storage space in Antwerp-Rotterdam-Amsterdam and Northwestern Europe that was previously used for Russian imports has now been reallocated to cargoes from the U.S. and Red Sea sources. Those supplies are being sold FCA on a break-bulk basis. Prices are unchanged at €1,050/t-€1,080/t for SN150, at €1,155/t-€1,185/t for SN500 and around €1,390/t for bright stock.

The euro’s exchange rate against the U.S. dollar dipped the past week to $1.08711. The price differential between Group I sales within Europe and theoretical exports remains €125/t-€185/t, export prices being lower.

European Group II demand remains healthy going into summer. As mentioned earlier, blenders are trying to maximize use of Group II as a blend stock for finished lubricants because of the price advantage over Group III grades. Group II does not suffice for all formulations, but decreases in polyalphaolefin prices create options to tinker in search of optimal solution. Additive suppliers have been instrumental in this work.

The European market is undergoing a strong shift to premium base stocks, and Group II is in the middle of this trend. There is news from Brussels supporting rumor of a free trade agreement between the EU and the U.S., but is difficult to say when a deal might be reached. Both sides are investigating the issue, and a report is expected toward the end of this year. It is unclear how this would affect neighboring countries such as the United Kingdom, but the U.K. could pursue its own pact with the U.S.

Group II prices are unchanged at €1,090/t-€1,175/t ($1,196/t-$1,289/t) for 100 neutral, 150N and 220N and at €1,295/t-€1,360/t ($1,421/t-$1,492/t) for 600N. Note that the lighter grades do not all occupy the same spectrum of the range given for those grades; 100N and 150N are at the higher end, while 220N is lower. These prices apply to a broad range of Group II oils from Europe, the U.S., Asia-Pacific and Red Sea sources, imported in bulk or flexi-tanks.

The refinery in Cartagena, Spain, which includes a joint venture Group III base oil plant, reportedly went into full turnaround at the beginning of last week. The work is scheduled to take around a month, although some reports were heard that it could be completed earlier.

Group III cargoes have been arriving from the Middle East Gulf, and another round is being planned from Sitra, Bahrain, and Al Ruwais, United Arab Emirates, with vessels loading during June and July. Another large cargo of gas-to-liquids Group III+ will load out of Qatar and come into Europe probably during July. The cargo is reckoned to be around 25,000 tons, all bound for the Shell system rather than the merchant market.

Prices for Group III oils with partial slates of finished lubricant approvals or with no approvals are trimmed slightly here due to discounts being offered to a few regular buyers. These “incentives” are being offered by distributors to hold market share now that new and more established sellers from South Korea are offering lower numbers. One seller is offering 4 centiStoke material with lower performance specs, hence the justification for lower prices.

Prices in this category are now assessed in a very wide range of €1,685/t-€1,820/t for 4 and 6 centiStoke oils and at €1,730/t-€1,750/t for 8 cSt, where available. All of these prices are on an FCA basis ex Antwerp-Rotterdam-Amsterdam or Northwestern Europe.

Group III oils with full slates of approvals – currently available ex Cartagena refinery – are unchanged at €2,020/t-€2,060/t for 4 and 6 cSt, on an FCA basis ex Antwerp-Rotterdam-Amsterdam, Northwestern Europe or Spain. Eight cSt oils are not sold in large enough volumes to allow reporting a price for Europe, but amounts are being exported to places such as India and Turkey for around €1920/t on an FOB basis.

Baltic and Black Seas

Baltic reports are thin on the ground, with no outgoing cargo movements recorded during last week. A couple of smaller base oil parcels have been seen moving from northwest European ports and Antwerp-Rotterdam-Amsterdam into the Baltic for receivers in Latvia and Lithuania. Blenders in these regions are having to reorganize their supply chain, following the EU ban on Russian imports. Lukoil continue to look for vessels to move cargoes out of Svetly to Gebze in Turkey, with two parcels on the table for May loading. A cargo is planned for receivers in Singapore, following other regular supplies which have been continuing for a couple of years. The difficult may be in finding suitable vessels to take these 10,000-ton parcels to Singapore, due to the restrictions imposed by the EU.

Sellers from Gdansk are intimating that they may not have any avails until July, with a number of buyers looking to take material from this source. One buyers based in the United Kingdom was relying on getting supplies during May for delivery into the west coast of the U.K., but these plans will have to wait until material becomes available. Other options may be to look at taking material from Algeciras or Greece, but availabilities from those sources are doubtful.

FOB prices from Svetly are pure conjecture, with “guesstimates” established by taking CIF prices into Gebze. Landed prices are discounted by estimated freight rates. As indications only, SN 150 levels are reckoned at $825/t-$875/t, with SN 500 at $845/t-$890/t.

FOB prices for Group I material from Gdansk refinery will be placed in line with European mainstream pricing, Currently, without any material available until July, prices are indications only, and are presented simply for comparison. SN 150 would be assessed at $1,025/t-$1,070/t. SN 500 at $1,095/t-$1,140/t, depending on destination. Quantities of bright stock are estimated at $1,300/t-$1,355/t.

With election fever in Turkey, the base oil market has gone very quiet, but with Russian imports still going into the main ports. The Baltic cargo will be on the high seas and should arrive in Gebze around early June. The cargo from Aghio is going to discharge in Derince with 4,400 tons of Group I neutrals. Turkish blenders are looking to take material from Mediterranean sources such as Livorno, Aghio and Augusta in Sicily. But with Livorno refinery going into turnaround for fuels production, it is unclear if there are any availability for base oils during the ensuing period.

The Turkish elections – with no candidate getting more than 50% of the vote – are to go to a run-off between the two leading candidates who are the existing President and a challenger. This election finale will be held on May 28. Thereafter, the market may return, and buyers might restart purchasing base oils once again. At the moment virtually no trades are being completed, with blenders saying that they will only consider offers after the election. Now that this process has gone to the end of the month, the lack of action is being prolonged further.

Existing offers from Greek sellers in Aghio were exceptionally low but have now lapsed. These levels were for deliveries in April and May and were heard on basis of CIF Gebze, at $1,025/t for quantities of SN 150, with SN 500 and 600 at $1,060/t-$1,085/t. Latest offers are at higher prices. Levels are reckoned to be around $1,085/t for SN 150, with SN 600 at around $1,095/t.

Tupras availabilities from the refinery in Izmir are showing local prices in Turkish lira as follows: spindle oil Tl 20,725/t ($1,057/t), SN 150 Tl 17,269/t ($881/t), SN 500 Tl 19,999/t ($1,020/t), with bright stock at Tl 24,767/t ($1,263/t). Prices are for ex-rack truck sales.

Lukoil have had one cargo loaded from Limas terminal in Turkey. This was the parcel of 4,000 tons, with another believed to be a cargo of 6,500 tons of Russian export barrels loading later this month. The base oils will come out of Volgograd refinery, shipped by Volganaft vessels, stored in Limas terminal and then re-shipped to receivers in Singapore.

Group II ex-tank prices remain unchanged with levels assessed at €1,210/t-€1,245/t for the three lower vis products – 100N, 150N and 220N – with 600N at €1,390/t-€1,485/t. Supplies of Group II grades may be sourced from the Red Sea, the United States, South Korea and Rotterdam or hub storage in Valencia.

Partly-approved Group III base oils, resold by distributors on an FCA basis or on a truck-delivered basis, are adjusted lower and are now reassessed at €1,855/t-€1,885/t. Fully-approved Group III grades delivered into Gemlik from Cartagena are priced at €2,250/t-€2,300/t FCA.

Middle East

Luberef will load a number of large cargoes for the United Arab Emirates, India and Pakistan, with another parcel going into Ras Al Khaimah in the U.A.E. and Mumbai anchorage. The west coast of India is one of the regular destinations for Group I and Group II, with cargoes loading Group I and Group II out of Yanbu and Group I neutrals only from Jeddah.

Large cargoes of up to 19,000 tons are expected to load out of both Yanbu and Jeddah, with Group I grades SN 150 and SN 500 out of Jeddah, and Group I and Group II base stocks out of Yanbu. The first of these cargoes will load later this month, with another large parcel planned for the U.A.E. ports, Fujairah, Hamriyah and Jebel Ali. This cargo will contain around 17,000 tons of Group I and Group II base oils.

Shipping reports are showing a number of cargoes of varying sizes coming into U.A.E., comprised of Group I and Group II base oils. Cargoes are loading out of Yanbu and Jeddah, and another parcel en route from Augusta and Valencia to the U.A.E. Regional demand is rising for Group II base oils, with blending operations concentrating on higher spec passenger car motor oil and heavy-duty motor oil lubricants, as more sophisticated European and U.S. vehicles are being purchased by owners in the U.A.E. and other Middle East Gulf states. Group II cargoes are increasingly taking the place of Group I in the U.A.E., although local sources informed this report that it would be a long time before Group I blends were extinct. Group II cargoes are arriving into the U.A.E. from the Red Sea, South Korea, the United States and Europe.

Stalwart Group I base oils are still required by many local blenders in the U.A.E., with a steady supply of Group I cargoes of 2,000-3,000 tons each supplied from Rayong in Thailand, with other alternative supplies of Group I base oils coming out of Indian refineries in Haldia and Chennai. With imports of cheap Russian crude, Indian Oil Corp. and Hindustan Petroleum Corp. are producing larger quantities of Group I base oils which – with raw material costs exceptionally low – have excellent margins when sold into receivers in UAE. Traders are offering Group l cargoes coming into the U.A.E. from U.S. Gulf Coast sources.

An offer for a cargo of Group I base oils to be imported into the U.A.E. from Lukoil, may or may not proceed. Prices are reported to be very low, but there remain problems regarding the voyage time from the Baltic. The counter to the voyage time could be the prices. The parcel remains at 7,500 tons to load from the Baltic for receivers in Hamriyah.

Group III cargoes form the export trade coming out of the Gulf, and these parcels are loading out of Sitra in Bahrain and Al Ruwais in Abu Dhabi. The follow on Stasco cargo from Sitra is loading this week with around 8,200 tons of Group III grades. The cargo will sail directly to Rotterdam, with the base oil being sold either FCA or delivered by truck or barge.

Another further Adnoc cargo will load from Al Ruwais. This parcel appears to be an additional cargo going into distributors in Nantong, China. The vessel will load around 7,000 tons of three Group III grades. The European replenishment cargo will load at the end of May for Chemlube, who distribute on behalf of Adnoc. The parcel is considered to be comprised of around 8,000 tons of three Group III grades.

Netbacks for partly-approved loading out of Al Ruwais and non-approved Group III base oils loading from Sitra refinery are taken slightly lower due to change in the selling prices in Europe and India. Selling prices in Europe are now discounted, albeit in a relatively small manner. Netback returns are now assessed at $1,715/t-$1,765/t, for the range of 4 centiStoke, 6 cSt and 8 cSt partly-approved and non-approved Group III base oils.

Netback levels are based on local FCA prices in markets such as Europe, India, the U.S., and China. Netback levels are then derived from regional selling prices, less marketing, margins, handling and estimated freight costs.

Group II base oils resold by distributors and traders on an FCA basis in the U.A.E. are sourced from European, U.S., Asia-Pacific and Red Sea producers. These grades are sold ex-tank U.A.E., and on a truck-delivered basis within the U.A.E. and Oman. Prices are maintained after moving upwards last week, with levels at $1,520/t-$1,465/t for the light vis grades, with 600N at $1,570/t-$1,565/t. The high ends of the ranges refer to road tank wagon deliveries.


South African shipping sources again confirmed that another large cargo of around 18,000 tons of mixed base oils will load out of Rotterdam and Fawley, discharging in Durban and then moving on to Mombasa with the balance of the cargo. The cargo should arrive in Durban around the end of June. On board will be quantities of Group I, Group II and Group III base stocks, with some easy chemicals, which may be white oils. There may also be a smaller cargo of 6,000-7,000 tons loading out of Yanbu for Durban. This Luberef parcel will be managed by distributors based in South Africa.

Traders ruled out purchasing Indian barrels for Nigeria, stating that the freight element is too high and would price the cargo out of the Nigerian market. Potential sources for imported Group I have also now included Singapore, although if Indian freight costs are too high, then Singapore freight to Apapa will also come into that range. Red Sea and U.S. Gulf Coast and U.S. Atlantic Coast are still in the frame, although many traders have ruled out getting cargoes from Europe unless Eni can offer FOB Livorno when product becomes available.

Jeddah and Yanbu have been included on the list on the basis that a cargo of two Group I grades sailed from this source to northwest Europe. if that voyage can work into the European market, then there is every possibility that a cargo loading out of Saudi Arabian Red Sea ports could work into Apapa. One negative is that there are only two solvent neutral grades available out of Jeddah refinery SN 150 and SN 500.

To load or blend bright stock to get to a SN 900 grade, the vessel would have to load at Yanbu for the same voyage. Alternatively, the total cargo could load out of Yanbu.

Russian material from Lukoil is offered out of Svetly terminal in the Baltic, but there appear to be problems in making this cargo work possible negatives regarding letters of credit and import licenses.

The stand-alone ExxonMobil cargo out of Fawley with around 6,500 tons of two Group I grades is now on the high seas and will deliver base oils into Abidjan in Cote d’Ivoire and Tema in Ghana. The Ghana tender supply normally requires three Group I grades, including a quantity of bright stock, but this could have been supplied by an alternative vessel en route to Durban. 

Another large cargo from the U.S. Gulf Coast and U.S. Atlantic Coast – with up to 20,000 tons of three Group I grades – is under consideration for June or July, but coordinating the supply of this size of cargo to two or more receivers is tough.

Prices confirmed for a recently arrived cargo had CFR levels at $1,020/t for SN 150, SN 500 at $1,070/t/ and SN 900 at $1,150/t. Bright stock would have been blended with SN 500, at loading, to produce SN 900. The inclusion of bright stock in the blend makes the SN 900 grade more expensive.

Offers for cargoes that will arrive in June or later will have higher prices due to increased FOB numbers. CFR prices will be SN 150 at around $1,045/t-$1,080/t, SN 500 at $1,125/t-$1,165/t and SN 900 at $1,200/t-$1,225/t.

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/

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