EMEA Base Oil Price Report


Base oil markets around Europe, the Middle East and Africa are flatlining as the August holiday season approaches, with poor demand leading to longer inventories at refineries and few prospects for the situation to improve anytime soon.

Most players are saying that it will be into September before the market has any chance to pick up with some calling that it will be into the fourth quarter before any positives are noticed from a demand perspective. The reasons behind these sluggish market conditions are that most major economies and even some of the second tier nations are finding things tough at the moment with stubborn inflation and high interest rates driving away many investment opportunities. Specifically for the base oils industry, demand for finished lubricants has waned and offtakes from blending operations are at an all time low.

The drivers behind this scenario are firstly the COVID-19 pandemic and secondly, the Russian invasion of Ukraine. These events have taken their toll globally, affecting all major economies, and many third world estates where there has also been civil strife and now, heightening temperatures which are posing their own risks in terms of forest and grassland fires and health issues associated with rising temperatures. Add all these factors together, and the resultant picture is the one being experienced right now.

Group I base oils are starting to go longer, with supply exceeding demand in many regions, and with this movement prices are starting to weaken further. The premium to diesel is now the lowest for many months if not years and is set to come even lower should the markets move into over supply. There is not a safety valve in the form of export markets at the moment, with seasonal bad weather affecting West Africa and other parts of that continent. Middle East temperatures are breaking records, with higher numbers than normal, and Europe is in the grip of an economic nightmare, with recessions just around the corner for many countries. 

Group II appears to be more balanced, with supply and demand matching each other at the moment, but this will change going forward into August when the market will slow. With many blenders closing down for four weeks or more, purchasing activity and offtake of product will be severely limited during that period.

Group III base stocks have moved about face into an over supply, with examples of suppliers insisting that customers lift their full allocated or contracted quantities before being able to lay hands on premium grades such as gas-to-liquids products or 4 centiStoke+ material, which is in demand and in short supply. Some distributors have had to take exceptional steps to clear inventories to be able to accept replenishment cargoes which are in route and on the high seas. Some are dumping products into available markets that can accept Group III base oils, and can absorb these grades into stocks, which may take some time to clear.

All in all a rather gloomy scenario with little cheer to lift spirits, at least, in the short and medium terms.

If there is any good news, it is that crude has been given a “mini boost” over the past few days. During last week, Dated Brent managed to climb above $80 per barrel, suggesting that demand for crude may be coming back after a lengthy period in the doldrums, when prices were steady and lower than Opec+ member would have liked.

Dated Brent and West Texas Intermediate crude oil prices lifted by around $2/bbl, with some commentators saying that there could be further upward moves in the pipeline. Some are forecasting that the third quarter would see rising demand, while other pundits have said that no real demand shift will occur this year, and it may be into 2024 before markets see growth returning, pushing demand for energy and therefore lifting crude and petroleum product prices higher.

Dated Brent has risen to a level currently reported at $79.20/bbl for September front month. WTI has also moved higher, to record at $74.80 per bbl, in respect of August front month. The crack is maintained at around $5 per bbl.

Low sulfur gas oil has remained steady and is posted at virtually the same level as last week, with a current price reported at $746 per metric ton, now having moved to August front month.

Prices were established from London International Commodity Exchange cob on June 17.


European Group I exports have remained missing, but there are suggestions that if the whole Group I market is to show longer over the next few weeks and months, then opportunities for export cargoes may return. The export market is akin to a safety valve that can be brought into play to balance the market.

The problem could be that there are few export destinations taking large slugs of Group I base oils at the moment. Regions such as West Africa are slow, and if any material is to be considered for this market, then alternative sourcing may be undertaken from the United States, where prices have been lower than in Europe.

At the moment there are no signs of an export drive starting but come August, when domestic and regional European markets are quiet, things could change.

Larger major producers are able to balance their inventories by moving material to satellite hubs and receivers and also moving base oils from one production site to others in their group of companies. This practice can be achieved on a global basis.

With the Group I base oil premium to diesel falling, the incentive for refiners to producer more base oils is waning, with distillate production probably now being promoted.

The latest reports on Livorno refinery in Italy is that production will not restart until October, if at all. Livorno refinery is to be converted into biofuels, with base oils and the feedstock for base oils perhaps not being made available. Further bulletins are expected before the end of July, with updates on when, and if, production will restart at this Group I location.

Export prices remain notional and are submitted for comparison purposes only. FOB numbers are slightly lower, with SN 150 now at $810/t-$875/t, with SN 500 and 600 at $925/-$1,000/t. Bright stock levels are also marked lower with indications at $1,125/t-$1,200/t.

European Group I domestic prices remain steady and stable and may remain at these levels during the remainder of July and perhaps even through August. Sellers are still keen to move as much material during this month, with August being very slow with plant closures and maintenance schedules kicking into blending operations across Europe.

Demand remains relatively weak due to lower offtake for finished lubes, with sellers hoping that July will boost inventories at blenders. The one factor that could push buyers to top up inventories is crude starting to rise, which could ultimately impact base oil prices. Prices from September moving forwards, could absorb some of the increases for crude, but at the same time vacuum gas oil prices are static and hence, base oil numbers may be unaffected.

July prices remain assessed around €885/t-€965/t for SN 150, with SN 500 at €990/t-€1,075/t. Bright stock is indicated at €1,195/t-€1,235/t.

The euro has dipped against the dollar, posting on Monday, July 10 at $1.12217.

The price differential between domestic and nominal export pricing is realigned, with export prices moving lower and domestic levels remaining. The differential is now assessed at €95/t-€145/t, with domestic prices being the higher.

European Group II prices are defiantly holding fast against all the odds, with no news or reports of any of the major suppliers moving prices mid-month. This has been the usual practice for any changes in Group II pricing over the past eight months. Sellers are quoting raw material price increases as one precursor to lifting prices higher, but buyers have negated this. They commented that while crude has moved marginally higher over the past few days, feedstock levels have remained steady, thus there was no significant increase in raw material costs.

Unlike Group I base oils, the Group II base oil premium to diesel remains attractive. The Group II base oil market being largely controlled by a relatively small number of sellers may prevent price erosion creeping into this market unless one or more of the suppliers starts to discount, as has happened previously, with the entire market having to align with the lower numbers.

Group II prices are maintained, with levels at €960/t-€1,125/t ($1,078/t-$1,263/t) for the three light vis grades – 100N, 150N and 220N – and 600N at €1,295/t-€1,360/t ($1,454/t-$1,527/t). U.S. dollar equivalent prices are adjusted higher due to exchange rate movement between the euro and the U.S. dollar.

Both 100N and 150N are typically priced higher than 220N due to the popularity and general usage in Europe of the two lighter grades.

Prices are for a large range of Group II base oils, including European, U.S., Asia-Pacific and Red Sea sources, imported in bulk and in flexies.

Group III prices are under increasing pressure with many sellers and distributors becoming desperate to move quantities out of inventory. The latest news is that one major supplier of fully-approved Group III base oils issued an edict to all customers who normally lift quantities of a premium grade – 4 cSt+ – that supplies of this grade will be subject to lifting full contracted or allocated quantities of 4 cSt and 6 cSt base oils during each month. Many buyers have not been accepting allocations and have been postponing or delaying, with some buyers still to take material that should have moved in April.

Buyers in the Mediterranean, and now northwest Europe, are receiving offers for smaller quantities of GTL-produced Group III+ base oils, with availabilities in flexies. Latest prices for these grades are indicated at €1,725/t-€1,765/t CIF Mediterranean ports, or €1,755/t-€1,785/t CIF northwest European ports.

Partly-approved and non-approved Group III base stocks, 4 cSt and 6 cSt grades are now assessed in narrower ranges. The two grades are assessed at €1,545/t-€1,620/t, 4 cSt and 6 cSt Group III base oils have both been offered at €1,545/t, with 8 cSt priced at €1,535/t-€1,600/t. Prices are based on FCA supplies from Antwerp-Rotterdam-Amsterdam and northwest Europe.

Fully-approved Group III base oils from Cartagena refinery in Spain, holding Volkswagen 504/507 approvals, are priced in a range for 4 cSt and 6 cSt grades, at €1,935/t-€1,975/t. These levels have slipped a little but remain higher due to approval status. Smaller quantities of 8 cSt base oil that are required for certain specialty applications in the European market are priced at €1,920/t-€1,935/t. Prices for all three grades are for FCA sales from hubs in Antwerp-Rotterdam-Amsterdam, northwest Europe and Spain.

Baltic and Black Seas

The Baltic region transformed into a net importer of base oils, and now covers all types of base stocks – Group I. Group II and Group III. Additionally, quantities of rerefined base oils are also added to the slate, taking advantage of the relatively local availability of these oils from a plant in Denmark. A few parcels are still loading out of Kaliningrad for Lukoil sales into Turkey, and occasionally into Nigeria, but these parcels are very dependent on shipping availability, the cargo sizes being adapted to fit the vessel – not the normal way to charter for a fixed cargo size.

There remain a number of rumors around that Lukoil may look to close the terminal at Svetly – which is fed by rail, transiting through Lithuania – but with no direct communications with that supplier, news is a little thin.

Lotos and PK Orlen in Gdansk have availabilities of Group I base oils during the next few months, with production returning after some time. The tender of 4,000 tons in total made up of all three Group I grades loaded from Gdansk. The cargo was comprised of 1,500 tons of SN 150, 2,000 tons of SN 500 and 500 tons of bright stock. Prices were exceptionally keen and were heard to be $830/t, $950/t and $1,200/t, respectively.

FOB prices from Svetly can only be “guesstimated” by taking CIF prices landed into Gebze, the latest heard at $890/t for SN 500, minus estimated freight costs and margins. Prices appear to have dropped by $10/t-$20/t over the past month, but 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.

FOB prices for Group l base stocks from Gdansk refinery are 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, as per the latest tender.

Turkish markets are confusing, with Russian SN 150 and SN 500 continuing to be imported into Turkey, while. only the Algerian supply alludes to any Mediterranean barrels purchased for higher quality finished lubricants for internal Turkish markets.

The 6,000-ton cargo comprised of three Group I grades discharged in Gebze. This was a cargo from Sonatrach in Algeria, which was a sale tender. The quantities were noted to be 3,000 tons of SN 500, 2,500 tons of SN 150 and 500 tons of bright stock 150. CIF delivered prices were confirmed as SN 150 at $875/t and SN 500 at $995/t, but no information was heard on the bright stock price.

Tupras, a refiner based in Izmir, is exporting all production because no buyers in Turkey can afford their prices, and also it gives access to dollars, which have become unavailable from Turkish banks. Government instructed banks not to issue foreign currencies.

Reported prices were SN 150 at $850/t, SN 500 at $945/t and bright stock at $1,200/t, basis FOB Gebze or Aliaga. These prices are considered to be very keen. Tupras is forced into exporting all production because local buyers are unable to afford to purchase at the high levels demanded.

Russian base oils imported into the Turkish market have delivered prices around $890/t for quantities of SN 500.

Mediterranean sourcing for Group I cargoes is extremely limited with Livorno supplies out of the picture. Motor oil Hellas in Aghio is balanced with Group l base oils and refuses to offer rock-bottom prices to the Turkish market. They sell into the Greek domestic markets, maintaining better margins. ExxonMobil can offer supplies of Group I base oils from Sicily or a Valencia hub, but prices are high and cannot meet Turkish buyers’ expectations. Delivered prices are around $200 or more higher than Russian imported barrels on a delivered basis.

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

Group II ex-tank prices are maintained, with levels 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. Supplies of Group II grades are sourced from the 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. A European distributor has dumped large quantities of partly-approved Group III base oils from European storage into Turkey, due to an impending supply arriving on another cargo already loaded for supply into Antwerp-Rotterdam-Amsterdam. 

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 shipping reports show two large cargoes loading out of Yanbu and Jeddah for the west coast of India and the United Arab Emirates. India has surplus quantities of Group I base oils due to cheap Russian crude imports. The quantities of base oils moving from Yanbu are possibly Group II grades, but with Jeddah also as a load port, Group I base oils must be part of the cargo. A 6,000-ton parcel of Group II base oils is being lined up for South Africa.

From Yanbu and Jeddah a large Group I and Group II cargo will discharge in Fujairah, Ras Al Khaimah and Hamriyah in the United Arab Emirates. Another cargo of some 12,000 tons will load from Yanbu only and will discharge during August in Jebel Ali. This cargo will be Group II supplies and will contribute to the U.A.E. supply of Group II base oils in addition to supplies from Al Ruwais refinery, which has nameplate capacity of 120,000 tons of Group II grades. That is in addition to the main production of Group III base oils. Adnoc production is mostly retained and used internally for in-house blending, with only small quantities sold to U.A.E. markets. Adnoc therefore do not have to procure quantities of Group II base oils on the open market.

Premium base oils in the U.A.E. are becoming the principal type of base oils, with a transition from Group I only getting underway a few years ago. That was prompted by the new generation of finished lubricants required in the U.A.E. to service imported vehicles. Luxury vehicles are imported into the U.A.E. market from the United States, Europe and Japan. With a fast growing economy and a great deal of Russian money pouring into the U.A.E., demand continues to exceed supplies.

Other Russian products also are imported into the U.A.E. in the form of Group I base oils. They are used in toll blending operations, following which finished lubricants are then exported to East Africa and other Middle East Gulf countries. Some of these lubes find their way into the U.K. and EU markets at exceptionally low prices. This is frowned upon by a number of blenders based in the U.K. and EU and may actually be a form of money laundering. It may also breach EU and allied protocols on the importation of Russian products.

With Group I base oil cargoes moving into the U.A.E. from Saudi Arabia, Russia and Thailand, Iranian base oils are no longer the principal blend material of the past.

A couple of potential Russian export cargoes are coming either from Svetly in the Baltic, or from Limas terminal in Turkey. These parcels are not fixed firm as of yet but are shipping inquiries in the market. Accessing vessels to take these cargoes remains a problem for the sellers. Deals have been finalized and letters of credit opened, but apparently no vessels were found to load the contracted quantities.

Group III exports continue into India, China, the U.S. and Europe, with suppliers having fixed a number of vessels to load out of Sitra in Bahrain and Al Ruwais in Abu Dhabi. A further large cargo of up to 25,000 tons may load from Ras Laffan in Qatar for a Shell company. This cargo may sail for Europe or the U.S. but it is assumed that quantities from this cargo will be retained within the Shell group of companies and will not be resold or distributed as gas-to-liquids-produced Group III+ base oils.

Adnoc loaded a cargo from Al Ruwais for the European market, which caused a containment problem in Antwerp-Rotterdam-Amsterdam. Sales of these Group III grades have not been progressing a quickly as the distributor would wish, hence an unknown quantity was placed into the Turkish market.

Netbacks for partly-approved base oils loading out of Al Ruwais and both partly-approved and unapproved Group III base oils loading from Sitra are maintained this week. Levels remain with netback returns at $1,600/t-$1,655/t, for 4 centiStoke, 6 cSt and 8 cSt partly-approved and non-approved Group III base oils.

Netback levels are derived from regional selling prices, less 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 unchanged at $1,520/t-$1,465/t for the light vis grades 100N, 150N and 220N, 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 large European cargo for a major with around 19,000 tons of base oils was fixed and will load in the next couple of weeks. The cargo will discharge Group I, Group II and Group III base oils in Durban. Twelve grades of base oil may be loaded in various quantities, with complicated loading and discharge drills for each of the grades involved. The cargo will load out of Rotterdam and Fawley.

West Africa continues to suffer the rainy season with still a few weeks to go until the end. The season occurs from June through to September although this year the season has been sporadic with particularly heavy rainfall occurring at the start of the season.

The heavy rains affect all countries in West Africa from Senegal in the west to Cameroon in the east. Nigeria is particularly affected with transportation problems affecting all businesses, including the supplies of base oils from shore storage in Apapa to blenders’ plants which are located some distances inland.

Demand for base oils has been slow following the elections and the associated court cases and protests, but there appear to be enquiries for cargoes to arrive in August. Traders are trying to source material from U.S. Gulf Coast and U.S. Atlantic Coast to try to put together an 18,000-ton parcel of SN 150, SN 500 and SN 900.

Multiple receivers will be involved, causing problems and delays with payment instruments and methods. Problems incurred are different quantities, various payment methods – including traders having to accept local naira payments – unconfirmed letters of credit, and cash from the black market.

Ideally, traders would wish for one receiver, and be furnished with an acceptable letter of credit issued by a local Nigerian bank, which would then be confirmed by a prime European bank, leading to guaranteed payment for the cargo. Of course, the traders would still be open and liable for any demurrage or detention incurred by the vessel, while awaiting to discharge the cargo.  

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

Prices for a delivered cargo in June had CFR numbers confirmed 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 may be slightly lower due to the level of competition in the Nigerian market and also lower FOB numbers. There may be around five traders interested in trading base oils into Nigeria, although one or more who were major suppliers have declined to participate due to the recent complexities of the market.

CFR prices may be in the following ranges: SN 150 at around $1,000/t-$1,045/t, SN 500 at $1,060/t-$1,175/t with SN 900 at $1,125/t-$1,265/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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