EMEA Base Oil Price Report


Base oil markets are gearing down for the holiday period that is fast approaching. Trading across much of Europe and the Middle East will slow during August, when vacation time is traditionally taken by many players.

Many blending operations will either close temporarily or will reduce working hours, and some said recently that plant maintenance and servicing of equipment will be undertaken during the downtime, as is often the case. 

Some participants have confirmed that they will continue to manufacture finished lubricants since they have to meet delivery dates in early September. These are the exceptions rather than the rule, though, as a host of blenders plan to close down during the last week in July and not reopen until the first week in September.

API Group I markets are quiet, and European exports still missing from the radar. Not many producers have the quantities of Group I oils to offer for export markets, which is perhaps just as well, since many of the export destinations have gone quiet due to the rainy season in West Africa, monsoons in India and the temperatures peaking in the Middle East.

Summer is a quiet time in Middle East Gulf and African markets where most of the Group I export trade is focused. Any supplies of cargoes into these locations will possibly be sourced from the United States, where the arbitrage is open for West Africa and the Middle East Gulf, and where Group I material is available at competitive prices.

One or two suppliers have tried to assemble smaller parcels for export. One was in Turkey, where refiner Tupras initiated a tender to sell 4,000 tons of solvent neutral 150 , SN500 and bright stock – to European based U.S. traders who reportedly will resell on an FCA basis in Rotterdam after loading from Aliaga, Turkey.

This is another example of “imported” Group I hitting the European mainland, which is essentially short of that grade. The ban on Russian imports has created a vacuum, making opportunities for suppliers such as Tupras and Saudi Arabia-based Luberef.

Group II supply and demand are basically balanced around Europe with output from Rotterdam and imports from the U.S. Prices are holding up, but there is little sign of upward pressure. Group III prices are headed south as new entrants try to win their place in a market that has become oversupplied. Group III values are being eroded not just around Europe but also in East Africa, South Africa and the Middle East Gulf.

Crude oil prices recovered over the past week, rising around $3 per barrel since the previous report. Dated deliveries of Brent crude increased to $77.90/bbl, for September front month settlement, while West Texas Intermediate reached $73.30/bbl for August front month.

Low-sulfur gas oil prices rose around $50 per metric ton to $748/t, still for July front month. All of these prices were obtained from London ICE late June 10.


Group I exports from Europe are still nil due to a lack of larger quantities available for such trade as well as a lack of demand in potential export markets. There are one or two opportunities in places like Nigeria, but other sources are offering more attractive prices and better availabilities.

Once again, in-house contract cargoes are in evidence but are only oil majors moving base oils to balance inventories or supplying contract barrels to receivers in areas such as West Africa.

One major sent Group I grades into Guinea and Cote d’Ivoire, and to Tema, Ghana, where it is contracted to deliver a cargo every six weeks or so. The contract is tendered every year but is frequently awarded to the incumbent supplier.

The Group I base oil premium over diesel continues to fall but is still very acceptable to producers, creating strong incentive for refiners to maximize base oil output at the expense of distillates. There is still demand for distillates that may override that incentive. All fuels production can be sold in the European arena, whilst Group I base oil may have to depend on an export market, which is weak at the moment.

Recent reports from the Eni’s Livorno, Italy, refinery would resume production this month or next appear to have been fake news, as the company now says operations will not restart until October, if at all. The hesitation and confusion stems from the announcement that Livorno is to be converted to a biofuels refinery and base oils may not form part of that portfolio. More news is expected during the next few weeks.

Prices for Group I exports from Europe are purely notional and are offered here for comparative purposes only. Values would have fallen again to between $830 per ton and $895/t for solvent neutral 150, $940/t-$1,025/t for SN500 or SN600 and $1,165/t-$1,220/t for bright stock, all on an FOB basis. The lower ends of the ranges are now based on a sale tender out of Turkey.

Group I demand within Europe remains weak, but sellers are pinning hopes that sales will pick up this month since they expect little business in August. Despite temporary shutdowns at a couple of main Group I sources, availabilities remain adequate.

There appears to be little upward or downward pressure on prices, which are unchanged this week at €885/t-€965/t for SN150, €990/t-€1,075/t for SN500 at €1,195/t-€1,235/t for bright stock.

The euro’s exchange rate against he U.S. dollar is little changed this week at $1.09537. The notional price differential between Group I sales within Europe and exports is once again unchanged at €75/t-€125/t, export prices being lower.

European Group II prices are holding up against buyer lobbying for discounts. European economies will dictate whether demand perks up, but the current environment makes it difficult to justify higher prices for items such as lubricants. The fact that the Group II base oil market is largely controlled by a small number of sellers may insulate it from some of the price-eroding forces currently affecting the Group I segment.

Group II prices are unchanged this week at €960/t-€1,125/t ($1,030/t-$1,205/t) for 100 neutral, 150N and 220N and at €1,295/t-€1,360/t ($1,421/t-$1,492/t) for 600N. 100N and 150N are typically priced higher than 220N due to the popularity of the two lighter grades. All of these prices apply to a large range of Group II oils from Europe, the U.S., Asia-Pacific and Red Sea sources, imported in bulk and in flexies.

Group III may be stabilizing. Some market sources say current numbers could stick, but there are still some cowboy suppliers being tempted to offer lower prices, causing constant review and some additional discounting by distributors trying to retain market share.

Buyers in the Mediterranean and in Northwestern Europe are looking to take relatively small quantities of gas-to-liquids Group III+ base oils being offered in flexies and now priced at €1,725/t-€1,765/t on a CIF basis at Mediterranean ports.

Mineral oil Group III base stocks with partial slates of finished lubricant approvals or with no approvals are now priced at €1,550/t-€1,695/t for 4 and 6 centiStokes and at €1,545/t-€1,675/t for 8 cSt, all on an FCA basis ex Antwerp-Rotterdam-Amsterdam or Northwestern Europe.

Group III oils from Cartagena, Spain, with full slates of approvals, including Volkswagen’s VW 504/507 passenger car engine oil standard, are priced at €1,955/t-€1,985/t for 4 and 6 cSt. Small quantities of 8 cSt, which are required for specialty applications in the European market, are at €1,920/t-€1,935/t. Prices for all three grades are on an FCA basis ex hubs in Antwerp-Rotterdam-Amsterdam, Northwestern Europe or Spain.

Baltic and Black Seas

The picture in the Baltic region shows how the ban of Russian export barrels coming into the European Union and other allied countries has affected the whole region. Where once cargoes were loaded out of Riga, Liepaja and Svetly for the U.K., Scandinavia and Antwerp-Rotterdam-Amsterdam, only a few parcels are now loaded out of Kaliningrad for Lukoil sales into Turkey, and very occasionally into Nigeria. Trading, as it was known, has almost disappeared because only deep-sea cargoes are anticipated loading out of Svetly. These are few and far between, since shipping and financing these cargoes are only two of the major obstacles about base oil supply out of the Baltic. There are rumors afoot that Lukoil may look at closing the terminal at Svetly, which is fed by rail transiting through Lithuania, although no confirmation or news on this closure can be ascertained due to a lack of communications with Russian companies.

It is understood that production from Perm refinery in the north could be redirected to Black Sea terminals, where base oils would go into Turkey or could be trans-shipped further to the U.A.E. or Central and South American markets.

The majority of cargo movements in that region are now imports into Baltic States from mainland Europe, the U.S. and Asia-Pacific sources. Group I, Group II and Group III base oils are now part of the new slate for Lithuanian and Latvian blenders.

Lotos and PK Orlen in Gdansk announced that availabilities of Group I base oils will be forthcoming during the next few months, with production getting back to some form of normality after some time. The sale tender of 4,000 tons in total, made up of all three Group I grades, will load from Gdansk either this week or next. The cargo is made up of 1,500 tons of SN 150, 2,000 tons of SN 500 and 500 tons of bright stock. Prices were exceptionally keen and are confirmed to be, respectively, $830/t, $950/t and $1,200/t.

FOB prices from Svetly are only “guesstimated” by taking CIF prices landed into Gebze, the latest which are heard at $890/t for SN 500, minus estimated freight costs and a margin. Prices appear to have dropped by $10/t-$20/t over the past month, with one cargo of 3,000 tons arriving from Kaliningrad. As an FOB indication only, SN 150 is assessed at around $725/t-$765/t, with SN 500 indicated at $770/t-$800/t. Prices are presented on a “best indication” basis only.

FOB prices for Group l base stocks from Gdansk refinery in July will now be realigned, with levels on an FOB basis being SN 150 at $830/t, with SN 500 at $950/t and bright stock at $1,200/t.

Information received from sources in Turkey indicates that that country is in a bad way from a base oil viewpoint, with Tupras, the local refiner based in Izmir, exporting all production because no buyers in Turkey can afford their prices. Tupras aligned its selling prices, with the high ends of the ranges from a well-known pricing report and have issued a sell tender every month starting in April this year, with a follow up in May and June. These cargo lots have all been 6,000 tons of three Group I grades, with the latest parcel having been sold to a major that apparently paid higher prices than the Tupras local numbers. This is contrast to information received last week, when a 4,000-ton export cargo was put up for sale by Tupras at much lower prices.

The reported prices heard last week were SN 150 at $850/t, SN 500 at $945/t and bright stock at $1,200/t, all basis FOB Aliaga. These prices are considered to be very keen. With no option but to export all production, Tupras is unable to sell to the local market due to Turkish blenders being hit hard by the high base oil prices – which means Tupras is forced into exporting.

Russian base oils continue to flow into the Turkish market with delivered prices heard at around $890/t for quantities of SN 500.

Mediterranean-sourced Group l cargoes are scarce, with Livorno supplies out of the picture for the moment. Motor Oil Hellas from Aghio is short of Group I base oils and will not offer at very low prices into the Turkish market when they can sell locally into the Greek domestic markets, maintaining margins and contributions. ExxonMobil is able to supply Group I cargoes from Sicily or from the Valencia hub, but again prices are high and cannot match Turkish buyers’ expectations. An offer was made from Augusta, but prices were too rich for Turkish buyers. Delivered prices were around $200+/t higher than Russian barrels on a delivered basis.

Exxon Mobil’s offer out of either Augusta in Sicily or Valencia was priced with SN 150 at $1,050/t, with SN 500 at $1,120/t basis CIF Gebze.

The cargo of 6,000 tons made up of three Group I grades did discharge in Gebze. It was a cargo from Sonatrach in Algeria, with quantities of 3,000 tons SN 500, 2,500 tons SN 150 and 500 tons bright stock 150. CIF delivered prices were confirmed at $875/t for the SN 150 and SN 500 at $995/t, while bright stock price was not heard.

Group II ex-tank prices are changed, with levels now heard at $1,050/t-$1,075/t for the three lower vis products – 100N, 150N and 220N – and 600N at €1,240/t-€1,265/t. These prices are heard from one of the major suppliers of Group II base oils. Supplies of Group II grades are sourced from Red Sea, the U.S., South Korea and Rotterdam or hub storage in Valencia.

Partly-approved Group III base oils sold by distributors on an FCA basis, or on a truck-delivered basis, remain unchanged, assessed at €1,725/t-€1,775/t FCA. Fully-approved Group III grades delivered into Gemlik from Cartagena refinery are priced at €2,100/t-€2,150/t FCA.

Middle East

Red Sea news has reports of a couple of large cargoes loading out of both Yanbu and Jeddah for the west coast of India. It is reckoned that India is full of Group I base oils due to the large quantities of cheap Russian crude flowing into the Indian market, allowing Indian refiners to produce extra quantities of Group I base oils. The quantities of base oils moving from Yanbu may be Group II, although with the inclusion of Jeddah as a load port, Group I base oils would figure in the cargo make-up. Group II supplies are being considered for South Africa again, with a follow-up 6,000-ton cargo planned for August.

From Yanbu and Jeddah, large Group I and Group II cargoes are bound for the U.A.E. ports of Fujairah, Hamriyah and Jebel Ali. Cargoes are also being sourced from various suppliers based in South Korea, the U.S. and Europe. The Yanbu cargo from Luberef will supply a large share of Group II base oils coming into the U.A.E. Adnoc from Al Ruwais refinery additionally produces 120,000 tons of Group II grades, in addition to the main production of Group III base stocks. The Adnoc production is mostly retained and used internally for in-house blending, with only small quantities being sold to U.A.E. markets.

The rise of Group II base oils in the U.A.E. is amazing, with this transition from Group I not really considered until a couple of years ago. It was prompted by the new generation of finished lubricants required in the U.A.E. to service imported cars and commercial vehicles, which have transformed the vehicle stocks in a wealthy economy. Luxury vehicles are now imported into the U.A.E. market, with dealerships at bursting point and demand exceeding supplies.

With the addition of Group I base oil cargoes moving into the U.A.E. from Saudi Arabia, Europe and Thailand, gone are the days when Iranian base oils were the only available Group I stalwart. Iranian base oils do not figure highly in the U.A.E. slate now, with alternative sourcing playing a major part of the supply scene into the U.A.E.

A number of “ghost” cargoes are being talked about, coming either from Svetly in the Baltic, or from Volgograd refinery via Limas terminal in Turkey. These parcels are assembled, but with a dearth of shipping options available to Lukoil, getting these cargo lots into the U.A.E. is causing problems. Deals have been done, and letters of credit opened, but vessels have not been found to load the correct quantities, with letters of credit being altered and reissued, etc.

Middle East Gulf Group III exporters fixed a number of ships to load out of Sitra refinery in Bahrain, while other vessels are down to load out of Al Ruwais in Abu Dhabi. A large cargo of almost 24,000 tons loaded out of Ras Laffan for Shell. This cargo is presumed to be either destined for Singapore or mainland China. Quantities from this cargo may be sold to local distributors, who in turn may then resell to European traders in flexies. This trade is new, since previously Shell companies would not allow the sale of straight gas-to-liquids-produced Group III+ base oils to third parties. This rule appears to have changed, with European traders able to purchase quantities of these prized base oils for delivery into Mediterranean and northwest European receivers.

Adnoc is still to load a cargo from Al Ruwais for Europe in the next few days. This replenishment cargo for the European market will now load with around 7,400 tons of three grades of Group III base oils for discharge into Dordrecht.

Netbacks for partly-approved base oils loading out of Al Ruwais and both partly-approved and un-approved Group III base oils loading from Sitra are taken slightly lower. Because of reported evidence of price dips in a number of Group III markets, levels are re-assessed, with netback returns at $1,600/t-$1,655/t, for 4 cSt, 6 cSt and 8 cSt partly-approved and non-approved Group III base oils.

Netback levels are derived from regional selling prices, minus marketing, margins, handling and estimated freight costs.

Group II base oils sold 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. Grades are sold ex-tank U.A.E., or on a truck- delivered basis within the U.A.E. and Oman.

Prices remain unaltered at 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 in the U.A.E. and Oman.

The next large cargo for a major with around 19,000 tons of base oils is fixed clean and will load towards the end of July or beginning of August. This cargo will discharge in Durban only, with Group I, Group II and Group III base oils on board. A total of 12 grades of base oil will be loaded in various quantities, with complicated loading and discharge drills for each of the grades involved. This is an “internal” cargo for affiliate and distributors.


West Africa still is experiencing the rainy season, with the wet weather still a few weeks to go. The season normally happens from June through to September, although this year the season has been on and off, but with particularly heavy rainfall occurring at the beginning of the spell. The heavy rains paralyze transportation and movement of goods and people, and affect all business in Nigeria, including the supplies of base oils from shore storage to blending plants located in the hinterland.

Demand for base oils has drifted away, but there are a couple of inquiries for cargoes to arrive in August. Traders are investigating supplies from the U.S. Gulf Coast and U.S. Atlantic Coast to try to put together a cargo of around 18,000 tons in total. As usual, there will be multiple receivers on board the one vessel, causing mayhem with payment instruments and methods. The usual problems are present, with various quantities and various payment options accompanied by having to accept local naira payments, unconfirmed letters of credit, and cash with dollars procured from the black market –not the ideal way of doing business in Nigeria.

Add in almost certain demurrage on vessels arriving with base oil cargoes – demurrage, which eventually will either remain unpaid, or will be heavily discounted for settlement.

The major has arranged a cargo delivering Group I base oils into Guinea, Cote d’Ivoire and Ghana. The cargo will load out of Rotterdam and Fawley with around 9,000 tons of three Group I grades, 5,000 tons of which will be supplied Tema port in Ghana.  

Prices for a delivered cargo had CFR confirmed by traders at levels of $1,020/t for SN 150, SN 500 at $1,070/t, and SN 900 at $1,150/t.

Offers for cargoes for August will be slightly lower due to the levels of competition in the Nigerian market. It is interesting that with all the pains of doing business in Lagos, that so many traders are still interested in entering the fray to supply base oils.

CFR prices will be in the following ranges: SN 150 at around $1,045/t-$1,075/t, SN 500 at $1,125/t-$1,165/t with SN 900 at $1,185/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/

Historic and current base oil pricing data are available for purchase in Excel format.

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