EMEA Base Oil Price Report


Regional variations are increasing between base oil markets in Europe, the Middle East and Africa, with demand spiking in some territories while slumping in an adjacent one.

The reasons for these spikes generally are not obvious, and activity within a region can change from high to low levels in a matter of days.

For example, in the Middle East Gulf area, the United Arab Emirates is experiencing growing demand for all types of base oils, whilst in adjoining areas such as Iran, Kuwait and Iraq, economies are depressed and base oil demand is sluggish or worse.

Similar situations can be found in Africa. Base oil business is thriving in southern and eastern corners of the continent but is slow in West and North Africa and showing no signs of improvement. In Europe demand is robust around the Mediterranean but poor in northern countries such as Germany and the United Kingdom.

Economic factors provide some explanation. The German economy is approaching recession, and the U.K. is on the brink. France, the Benelux countries and Scandinavia fare a little better, while economic activity is stronger in Spain, Greece and Italy where, coincidentally, base oils are showing short, particularly for API Group I and Group II grades.  

Crude oil prices continued to strengthen the past week as production cutbacks by Saudi Arabia and Russia appear to be shortening the market. Analysts estimate that the global market is running a supply deficit of around three million barrels of crude per day and will continue to do so through the year end, when the Saudis and Russians review production rates.

Dated deliveries of Brent crude approached $95 per barrel early this week, and the pace of increase shows few signs of slowing. Analysts predict prices will pass the $100/bbl mark sooner rather than later.

Base oil prices have also risen in recent weeks but have not kept pace with crude and values for other products such as diesel. As a result, base oils are contributing less profits than those other products – a situation that often leads refiners to shift feedstock from base oils to fuels.

Indeed, a growing number of refiners around Europe, the Middle East and Africa are cutting base oil run rates, which should eventually shorten the markets and may lead to a lack of availability for some Group I and II grades.

Dated deliveries of Brent climbed around $3.50 the past week to $94.75/bbl, still for November front month settlement. West Texas Intermediate rose around $3 to $91.80/bbl, now for November front month. The crack between the two benchmarks remains in a narrow range around $3.

Low-sulfur gas oil values are clinging to their lofty levels, dipping $18 per metric ton from last week’s high to $982/t for October front month. All of these prices were obtained from London ICE trading late Sept. 18.


Following a debacle two weeks ago when a refinery in Livorno, Italy, sold a non-existing base oil parcel, the operator issued new base oil prices, though it still seems unlikely that it would have base oils to sell given that crude oil deliveries to the site ceased during a recent maintenance shutdown.

The good news is that two cargoes of Arab Light crude did reach the refinery and were discharged into storage. This is a positive sign that operations will resume after a five-month hiatus, which is excessive to say the least. Political and economic decisions surrounding this closure have not been revealed to the public, so this report is unable to say with certainty what is transpiring and when base oil production will restart. Rumors say there may be availability in October or November.

There still is no real European export market for Group I base oils, but if availability was to surface somewhere, it would have to be priced closer than previously the values involved in intra-regional sales.

For comparison purposes only, this report assesses that those notional export prices would be between $1,065/t and $1,100/t for solvent neutral 150, $1,125/t-$1,225/t for SN500 and SN600 and $1,295/t-$1,360/t for bright stock.

Prices for Group I sales within Europe are unchanged since hikes that took effect Sept. 1, though some upward pressure probably still exists. Vacuum gas oil has reached a recent high, directly impacting base oil production costs. Additional pressure also comes from the negative premium to diesel. Historically Group I oils in Europe are priced around $200/t-$300/t above diesel values, which currently are approaching $1,000/t.

Demand in most regions remains good, Germany serving as an important exception. Few surplus barrels are available as the market moves shorter. Some buyers are looking to take larger quantities to replace depleted inventories, but many are struggling to cover immediate requirements.

There are rumors of one major supplier offering prices some $200/t below those listed here, but this would be strange since this supplier normally sets Group I levels within the region.

Prices are unchanged at €1,055/t-€1,120/t for SN150, €1,095/t-€1,200/t for SN500 and €1,265/t-€1,320/t for bright stock, all on an FOB basis.

The euro’s exchange rate to the U.S. dollar weakened the past week to $1.06658. The price differential between Group I exports from Europe and Group I sales within the region is unchanged at €100/t-€165/t, exports being lower.

Feedstock costs are putting upward pressure on European Group II prices, as is the narrowed premium to diesel. Price changes are usually announced mid-month, but no news has been heard so far, except for interim increases by smaller suppliers importing Group II grades in flexi-tanks, for example.

For the most part, Group II prices unchanged at €1,135/t-€1,170/t ($1,215/t-$1,250/t) for 100 neutral, 150N and 220N and at €1,230/t-€1,275/t ($1,325/t-$1,375/t) for 600N. These prices all apply to a large range of Group II oils from Europe, the U.S., Asia-Pacific and Red Sea sources, imported in bulk or in flexies. Typically 100N and 150N are typically priced higher than 220N due to the higher usage in Europe of the two lighter grades.

Group III prices were unchanged this week but may also face some upward pressure due to the run-up in crude costs. Refiners would like to restore premiums to diesel, but distributors and European buyers counter that availabilities are very good. There are fewer signs of surplus than a few weeks ago, but there is still choice in the market. Some lube blenders are opting to switch to a combination of Group II oils and extra additives.

Prices for Group III oils with partial slates of finished lubricant approvals or without approvals are unchanged this week at €1,485/t-€1,575/t for 4 centiStoke grades, €1,475/t-€1,545/t for 8 cSt and €1,495/t-€1,585/t for 6 cSt, all on an FCA basis ex Antwerp-Rotterdam-Amsterdam or Northwestern Europe.

A cargo of 4 cSt Group III with a full slate of approvals arrived in Europe from Chevron’s refinery in Richmond, California. The product is sold under the Nexbase brand, which was previously owned by Neste. This oil should provide competition for the fully approved Group III oils produced at SK Enmove’s joint venture plant in Cartagena, Spain, though it is not known if Chevron will also ship 6 and 8 cSt grades. Prices for Group III oils with full slates of approvals, including European approvals specifications are assessed at €1,875/t-€1,925/t for 4 and 6 cSt and at €1,860/t-€1,885/t for smaller quantities of 8 cSt, all on an FCA basis ex hubs in Antwerp-Rotterdam-Amsterdam, Northwestern Europe and Spain.

Baltic and Black Seas

There were further instances of relatively small quantities of Russian base oils feeding into markets bordering Russia following the report in this missive last week, which identified material going into Latvia and Bulgaria. Other rumored supplies have made their way into Lithuania and are being used as blend stock for the manufacture of EU finished lubricants. Quite how this practice is being achieved is not confirmed but comments have been received which suggest that it would be relatively easy for truck loads to be taken across the borders without meeting customs officials. 

“Black” supplies appear to be available from Russian traders who sell on an FCA refinery or storage basis to third parties, who in turn supply clandestine quantities of Russian base oil to some blending operations, either as European Union material or perhaps identified as Russian product. These base oils may be blended with other legitimate stocks prior to blending into finished lubes to disguise their use.

There would be a sufficient price differential to make the risks acceptable, this practice being very similar to the Turkish practice that has largely now been outlawed, where gas oil was added to base oils prior to producing finished lubricants. Also, gas oil is now more expensive than Group I base stocks, so it would not currently be a feasible option.

Cargoes of various base oils are entering the Baltic with imported material covering Latvian and Lithuanian blenders. The small cargo loaded out of Gdansk was delivered to receivers in Liepaja, with perhaps further supplies made from Gdansk refinery.

The 10,000-ton cargo moved from Kaliningrad to Singapore appears to have loaded and sailed for the discharge port. There are still shipping inquiries on the market for vessels to lift base oils from Svetly terminal and to move to Gebze. But for whatever reason many of these enquiries fail to materialize, leaving large quantities of Russian base oils in-tank in Kaliningrad.

It was noted that a parcel of around 5,000 tons loaded and was en route to Turkey, but again confirmation of this movement has not been possible, and only when the vessel discharges in a Turkish port will the information become available.

The sale tender from Gdansk has still not been resurrected, and it could be that the quantities of Group I base oils were sold elsewhere in the EU. For example, Gdansk refinery was supplying quantities to Italian blenders by truck, when it couldn’t purchase supplies from Eni due to the outage at Livorno refinery.

With prices rising, any bids for material coming out of Gdansk would now have to be around $1,120/t for SN150, SN 500 at $1,160/t, and bright stock at something like $1,340/t FOB Gdansk.

Turkish base oil markets remain subdued, but there are Mediterranean offers for base oil to be delivered from Aghio to receivers in Derince. How Turkish receivers were able to open letters of credit is anyone’s guess. That would have to have been done, or payment could have been made as a cash transfer directly to sellers after loading.

Inflation is still running high, and with interest rates at 26% with potential further hikes of up to 30% coming before the year end. The government still insists that banks may not issue foreign currency for traders to open letters of credit.

Russian base stocks form the majority of base oil imports going into Turkey, with prices moving upwards in line with domestic Russian prices. These increased last week by the ruble equivalent of $30/t. That is a small increase, but with cheap crude available, Russian base oil economics are hard to figure. SN 150 was confirmed CIF Gebze at $795/t, with SN 500 at $825/t. Those prices will now increase by $30/t.

Mediterranean sources had almost given up on Turkey taking Group I base oils. With prices rising continually, it is surprising to see some Turkish importers looking to buy more Mediterranean material. Perhaps the new production from Livorno will be available for Turkey by the end of November. Competing against Russian numbers is impossible, with estimated delivered prices for SN 500 now having to be pitched around $1,200/t CIF Gebze, $300/t+ higher than Russian offers.

CIF prices from Mediterranean suppliers would be around $1,160/t for SN 150, with SN 500 around $1,200/t basis CIF Gebze. Russian prices are heard at the following levels – SN 150 at $810/t and SN 500 at $850/t CIF Gebze. 

Group II ex-tank prices remain unchanged, but with other Group II prices across Europe may have to be adjusted next week. Current levels are around €1,145/t-€1,175/t for the three lower vis products – 100N, 150N and 220N –and 600N at €1,345/t-€1,370/t. Supplies of Group II grades may be sourced from the Red Sea, the United States, South Korea or Rotterdam.

Partly-approved Group III base oils resold by agents or distributors on an FCA basis, or on a truck-delivered basis, are maintained, with Russian 4 centiStoke grade from Tatneft priced at $1,400/t. Other suppliers, such as Adnoc, Petronas and Shell, with Bapco barrels from Sitra, have prices maintained, assessed higher at €1,625/t-€1,695/t FCA.

Gas-to-liquids-produced Group III+ is available from traders in Turkey. This material was brought in by traders taking material in flexies from Singapore.

Smaller quantities of fully-approved Group III grades delivered into Gemlik from Cartagena refinery are also maintained, at €1,995/t-€2,025/t FCA. Cargoes of 800-1,800 tons cover these requirements for a small number of blenders that require access to fully-approved Group III base oils. It will be interesting to see if Chevron establishes the “Nexbase” brand back into Turkey as a fully-approved product.

A number of cargoes loading out of Yanbu and Jeddah with Group I base oils and also Group II base oils are coming out of Yanbu refinery. Jeddah is able to provide quantities of Group I solvent neutrals, but this supply point is under review, with production of solvent neutrals ceasing sometime in 2025. Group II cargoes are moving into India, where large quantities of Group II base oils are now used. With new production of Group II facilities recently coming into operation in India, it will be interesting to see the effect this may have on imports from Yanbu.

Middle East

Middle East Gulf markets are booming, with a raft of inquiries for Group I and Group II cargoes to arrive mainly into the U.A.E. Bahrain has also issued a couple of inquiries for Group II cargoes, which may be supplied either from South Korea or from Yanbu. Enquiries are open to suppliers based in Saudi Arabia, the U.S. and India. Blenders in the U.A.E. are varied in the types of lubricants manufactured. Everything from specialty oils – such as electrical and transformer oils – to process, automotive and industrial oils, including hydraulic, turbine and transmission lubricants, is manufactured. Some blenders specialize in particular lubes, while others produce across the main spectrum of industrial and automotive grades.

The markets for blenders based in the U.A.E. are multiple, with finished lubes supplied to East Africa, Iran, Iraq, Kuwait, Pakistan and India. Further afield, specialty oils go into South America, Europe and U.S. markets, in addition to Asia-Pacific destinations. the U.A.E. claims to be the center for lubricant supplies.

There is news of a cargo of around 9,000 tons running out from Valencia and Augusta, going into Yanbu before proceeding to Jebel Ali in the U.A.E. This follows up other parcels that have taken a similar route to supplying Group I and Group II grades to an affiliate in the U.A.E.

Russian barrels are on offer for usual receivers in Hamriyah. Vessels will load from Limas terminal in Turkey as a bridging point for supplies for Lukoil coming from Volgograd or Perm refineries. Russian prices are extremely flexible and will be competitive when it comes to large cargoes coming into markets like the U.A.E. These are important outlets for Russian base oils, although trade may slow down, with maintenance schedules about to commence.

Prices are expected to be around $895/t for SN 150, with SN 500 estimated to be around $920/t, delivered CIF Hamriyah.

Group III base oil exports from the three Middle East Gulf production centers loaded and are in route to receivers in India, China, the U.S. and Europe. Cargoes are from the U.A.E., Qatar and Bahrain. Qatar-based Shell supplied around 47,000 tons in three cargo lots into India over the past three months. This is the largest quantity delivered into any market, although cargoes of around 25,000 tons loaded for China, Europe and the U.S. Supplies of the gas-to-liquids-produced Group III+ base oils are somewhat compromised by the resale of smaller quantities of this product from traders in Singapore, which are finding their way back to European buyers.

Netbacks for partly-approved base oils that will load out of Al Ruwais and Sitra are once again maintained at last week’s levels. Increasing raw material costs are under consideration. Seller Adnoc appears to be content with returns from the U.S market but is concerned about the price pressure being exerted in the European market, which was once the jewel in the crown.

Increases to FOB and delivered prices may start to kick in if feedstock costs continue to rise, with potential increases of around $70/t-$100/t.

Netback returns are maintained at $1,470/t-$1,535/t for 4 centiStoke, 6 cSt and 8 cSt partly-approved and non-approved Group III base oils.

Netbacks for gas-to-liquids material coming out of Ras Laffan in Qatar are estimated to come in at around $1,550/t-$1,600/t, with these numbers based on prices from traders in Singapore and subsequent selling prices in Europe.

Netback levels are established from various distributors’ selling prices, minus estimated marketing, margins, handling and freight costs.

Group II base oils sold by distributors and resellers 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 are maintained and continue to be assessed at $1,455/t-$1,485/t for the light vis grades 100N, 150N and 220N, with 600N at $1,585/t-$1,610/t. The high ends of the ranges refer to road tank wagon deliveries in the U.A.E. and Oman.


South Africa sources report that yet another large cargo will be dispatched from Europe to Durban and Mombasa. As is normal, the cargo will load out of Rotterdam and Fawley with Group I, Group II and Group III base oils and also a small quantity of easy chemicals that are imported for a sister company.

Nigeria is getting close to the final days of the rainy season, which has been long and severe this year. There appears to be no rush to buy base oils, even with the prices starting to escalate. Some of the traders involved in the base oil business have decided to pull out of base oils until such time as the local situation improves, meaning the banking system, the government attitude to imports and the availability of base oils from various sources.

Buyers in Nigeria appear to be resigned to facing the facts regarding prices which will move up due to crude and feedstock increases affecting markets such as the U.S.  European supplies are not available. Some buyers in Nigeria are trying to access Russian barrels from Lukoil, but the problems are in financing these cargoes, because Russian sellers do not have access to facilities available to Europe-based traders.

Escalating FOB prices, increasing freight rates due to bunker prices, rising insurance and crew costs – the list is endless for traders attempting to move cargoes of base oils into Nigeria. Buyers are also not prepared to increase finished lubricant prices, saying that the Nigerian market just cannot accept higher numbers. There is a squeeze on, with some players deciding to pull out of the base oil scene until elements improve one way or another.

One trader will load a cargo in early in October from the United States, on a two-port load basis from the U.S. Gulf and U.S. Atlantic Coast.

The Singapore-sourced cargo of around 8,700 tons is on the high seas and should arrive into Apapa this month or in early October. The freight rate was reported as a lump sum, which would equate to a rate of $197/t. FOB Singapore prices for the three grades were around $695/t for SN 150, SN 500 at around $835/t and SN 900 estimated following blending bright stock and SN 500. The bright stock was priced at $875/t, giving a composite FOB price of around $845/t, making this cargo possible after adding in freight, margins and demurrage.

The CFR Apapa prices for this cargo are estimated to be around $1,100/t for SN 150, $1,160/t for the SN 500 and SN 900 at around $1,195/t.

The exchange rate of the naira to the U.S. dollar has come down, back to 760N/U.S. dollar, making base oil business a little more attractive than a week ago when the exchange rate was down to 930N/U.S. dollar. Some receivers pay in local naira before traders can exchange the currency into dollars on the black market. Additionally, the Nigerian government has added to the problems by levying a 1% import duty on the value of the cargo imported.

As fundamentals are today, there will be pressure on base oil prices to rise.

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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