EMEA Base Oil Price Report


The armed conflicts in Ukraine and the Middle East are at different stages, but both are helping to push up crude oil prices. As long as they continue, crude values could get pushed above $100 per barrel – a development that would drive up values for other petroleum products, probably including base oils.

It’s no surprise then, that crude markets are being watched carefully for signs of rising prices.

Increases in petroleum product prices could also spur another flurry of inflation, running the risk of crippling economies that are starting to emerge from inflation and the most recent round of interest rate hikes. This in turn could stunt demand for products such as lubricants, perhaps so far as to cancel base oil capital projects.

The outlook for the base oil industry in Europe, the Middle East and Africa is negative right now, with many refiners diverting increasing quantities of feedstocks to production of distillates. This could cause some base oil markets to tighten, particularly the API Group I and Group II segments. Meanwhile, Group III suppliers are between a rock and a hard place, facing surplus supply and eroding prices, even as feedstock costs rise.

In some sense it is fortunate that demand is slack for almost all base oil grades throughout Europe, the Middle East and Africa, which is not at all unusual for this time of year. Forecasts suggest uptake of base oils may be lower than usual during the fourth quarter, leading to surplus inventories that have to be moved before the year end.

This scenario puts producers in an unenviable position, with refineries moving toward minimum run rates but inventories still increasing as demand remains stubbornly low. A year end sell-off seems unlikely given the pressure on producers to maintain prices and premia to distillates, which have come under severe pressure due to rising feedstock costs.

To this end, some majors have grasped the nettle and have applied large increases to Group I and Group II prices throughout Europe. This will exert some pressure on values in nearby regions.

Crude oil prices have been seesawing again, with dated deliveries of Brent crude climbing above $92 per barrel late last week as allies of Israel appeared to convince its government to scale back on its planned invasion of the Palestine’s West Bank but fell back below $90 as Israel’s position seemed to harden.

Dated deliveries of Brent crude closed in London Monday at $91.90/bbl, still for December front month settlement and slightly higher than one week ago. West Texas Intermediate followed a similar path to $87.75/bbl, also for December front month.

Low-sulfur gas oil dropped last week but then rebounded to around the same level from last week’s report, $923 per metric ton, for November front month. All of these prices were obtained from London ICE trading late Oct. 23.


The export market for European Group I base oils remains almost non-existent, with only vague suggestions of export sales being completed from a few Mediterranean suppliers. Motor Oil Hellas has a small export cargo available to go to Turkey, but odds are against a sale being made since prices for sales within Europe are reckoned too high for Turkish receivers to consider.

Eni announced availabilities from Livorno, but it is considered that the first priority will be Italian domestic customers, and only after surplus material is accumulated will offers be made to traders for export destinations. Again, prices may be pitched too high for receivers in destinations such as Nigeria to consider.

There are movements into contracted receivers in West Africa other than Nigeria, for example, into Conakry, Abidjan and Tema, sometimes in combination with large cargoes supplying affiliated receivers in locations in South and East Africa.

As over the past few weeks it has been difficult to report non-existent export prices which are being given only on a notional basis, with SN150 maintained this week, being assessed between $900/t-$950/t, SN500 also remains between $1025/t-$1100/t, but bright stock is taken higher to a range between $1250/t-$1335/t.

Group I domestic prices continue to being raised across the European market following the announcement by a major to raise levels by $90 across all grades a couple of weeks back, but some suppliers are yet to inform customers of any increases. However, notices are expected this week, either imposing immediate prices rises, or at latest from November 1.

In most cases increases have been commensurate with those imposed by ExxonMobil with some going even higher. The most severe increments were heard in Spain where numbers in some cases were pushed higher by around €140/t. It was pointed out that these prices started from a very low level.

The prognosis is that there will be further upward adjustments to come, since the base oil markets almost always experience a ‘lag’ behind most other petroleum products that are traded on a daily basis.

Prices remain steady this week, having had the increased levels noted in the last report with SN150 assessed between €1165/t-€1225/t, SN500 between €1220/t-€1300/t, and bright stock between €1375/t-€1450/t.

The euro’s exchange rate against the United States dollar was steady the past week, posting at $1.0597 Oct. 23.

Prices having increased for both domestic and notional export trades, the price differential is maintained between €160/t-€245/t.

Group II prices around Europe had been stable but with anticipated increases which up until last week had not appeared and then the same major who led the Group I sortie, also announced large increases to Group II prices. Levels were increased for all grades by up to $130/t, with most buyers having to pay between $90/t-$130/t more than previously.

It is expected that other Group II suppliers to the European markets will follow with notified increases during the next few days or will impose hikes from November 1.

The reasoning behind these moves becomes apparent when the very low premium to LSGO which was in place prior to these notices is taken into account, these increases will redress that lack of premium to an extent, but if gas oil prices remain high or move upwards, then further prices rises for Group II base oils may follow.

Price levels are therefore re-assessed between €1160/t-€1220/t ( $1220/t-$1280) in respect of the three light vis grades (100N, 150N and 220N), with 600N between €1290/t-€1355/t ($1355/t-$1425).

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

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

Group III prices are stabilising around current levels although generally the trend for these base oils is weaker. Demand is probably around the same as earlier this year, but what has changed is the quantity of material available in the European market which has exploded exponentially over the last four or five months, with additional material arriving from AsiaPac and Middle East Gulf sources, which were not previous players in the European Group III market.

As mentioned earlier this base oil group finds itself in an odd position with an oversupplied market, thus creating pressure on prices, and at the same time, increasing raw material costs which are impinging on returns for these grades. Price increases appear to out of the question at the moment, with demand constant but, with many more purchasing options that say, one year ago.

Re-refined Group III base oils are playing a greater part in this market with quantities emerging from an existing production site in Elsteraue in Germany, and another competitor’s facility coming on stream next year with quantities of re-refined Group III base stocks. It is assumed that 4 centiStoke product will be produced by that facility.

With 4 centiStoke re-refined material being priced a little lower than virgin production, these prices have been included in the partly-approved and non-approved ranges. 4 centiStoke remains priced for November between €1355/t-€1465/t, The low of this range pertains to re-refined material. 8 cSt is placed between €1400/t-€1445/t and 6 cSt between €1455/t-€1485/t. Prices are based on FCA supplies ex Antwerp-Rotterdam-Amsterdam, Northwestern Europe or, in the case of the rerefined oils, Germany.

Prices for fully-approved Group III base oils from Cartagena refinery are maintained this week. With the price differential between fully-approved and partly-approved Group III base oil being considerable, there is still reticence for a number of buyers to commit to contracted monthly volumes for next year.

4 centiStoke and 6 cSt grades are placed between €1835/t-€1885/t. Small quantities of 8 cSt oils are assessed between €1800/t-€1820/t. Prices are in respect of FCA sales ex hubs in Antwerp-Rotterdam-Amsterdam, northwestern Europe and Spain.

Baltic and Black Seas

Baltic reports suggest that Lukoil and Litasco have offered a cargo of Russian base oils to receivers in Nigeria, although this has not been corroborated nor confirmed from sources based in Lagos. One of the key elements of the deal will be the inclusion of extended credit and also the potential for payments to be made in naira. The seller would have to have representation in Nigeria to handle the exchange of naira on the black market.

Latest FOB prices for SN 150 from Svetly are expected to be around $670/t, with SN 500 at around $685/t. The options to take material from Svetly are almost a necessity because no traders are working cargoes from the Far East or from the U.S. Gulf Coast or U.S. Atlantic Coast at the moment. Prices would not work into Nigeria, and there are no European producers who either have the availability for a large export cargo to go into Apapa or would be able to compete on price.

In Svetly, SN 900 could be blended using SN 1200 or Russian bright stock along with quantities of SN 500 and SN 150, and they may be priced at around $725/t FOB Svetly. Whether this grade would be blended in Kaliningrad or at the refinery is not known. The final cargo would be comprised of a relatively small quantity of SN 150 and a larger quantity of SN 500, with the mainstay of the cargo being SN 900.

A 10,000-ton cargo is thought to be offered, but eventual quantities will be governed by whatever vessel is available.

Baltic imports continue into Baltic ports once used for exporting quantities of Russian barrels. Ports such as Riga and Liepaja in Latvia and Klaipeda in Lithuania are being used for imports of virgin base oils in addition to quantities of rerefined Group I material.

Gdansk availabilities remain vague. It could be possible that sellers are concentrating on placing material into the local markets where prices are higher, and sales are more sustainable. Prices would be in line with European mainstream levels for domestic sales.

Turkish base oil markets continue to be dominated by Russian imports, with no reports of any Mediterranean cargo deals being completed. There was material offered from Motor Oil Hellas from Aghio in Greece, but even at the lowest possible numbers, prices were reported to be too high for Turkish importers.

The Turkish economy is broken, with even the tourist trade in decline versus other options in the Mediterranean. The exchange rate for the Turkish lira heads south against the dollar, and inflation has climbed to the highest level reported officially at 51%. The government is expected to impose a further rise in interest rates before year end, taking the rate close to 30%. 

With the latest rises in Group I prices across Europe – and now the same, if not greater, increases coming to Group II base oils – this will not aid the situation In Turkey. 

The market is almost entirely reliant on Russian imports of SN 150 and SN 500 to supply blending operations across Turkey.

Imported Russian Group I base oil prices are steady, having moved higher last month, but with reports that levels may increase from next month by around $50/t.

Sources have suggested that SN 150 is sold at around €775/t, with SN 500 at €800/t.

The Tupras refinery in Izmir has ceased production again, this time apparently for around two to three weeks. The reason behind this stoppage is unclear. Prices for remaining product in tank remain unchanged until stocks are depleted. Prices for SN 150 are $1,166/t (Tl 24,519), SN 500 at $1,227/t (Tl 27,024) and bright stock at $1,450/t (Tl 33,167). Selling prices are in Turkish lira. Prices are ex-rack plus a loading charge of Tl 5,150/t.

Last week it was reported that the 4 centiStoke purchase tender from Petrol Ofisi was covered from a South Korean supplier. This was not the case, and the tender was not fulfilled. It is unclear if another attempt will be made to purchase a quantity of this grade.

Group II prices on an ex-tank basis are maintained this week, but it is expected that these levels will rise in line with European new prices from Nov. 1. Levels remain at 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 Red Sea, the U.S., South Korea or Rotterdam. Some traders are active in these supplies, with material loaded in flexies and delivered to Turkish receivers.

Partly-approved Group III base oils being resold on an FCA basis, or sometimes on a truck-delivered basis, are maintained, with Russian 4 cSt grade from Tatneft at €1,345/t. Other suppliers are €1,565/t-€1,610/t FCA.

Smaller quantities of fully-approved Group III grades are delivered into Gemlik from Cartagena refinery. Prices are maintained at €1,955/t-€1,995/t FCA. Cargoes of 800 tons to 2,000 tons cover these requirements for the small number of blenders that require access to fully-approved Group III base oils.

Middle East

Large cargoes are being loaded out of Yanbu and Jeddah are moving to the west coast of India. Other cargoes are moving into Alexandria in Egypt with 3,000-ton parcels of bright stock being regularly delivered for the Egyptian General Petroleum Corp. tender. Group II base oils are delivered to receivers in the United Arab Emirates, with another large cargo of around 19,000 tons discharging in Hamriyah and Jebel Ali.

Middle East Gulf supplies of Group I and Group II base oils are coming into the U.A.E. from many sources, including South Korea, Singapore, Rayong, and Rotterdam. Group I cargoes were being worked from U.S. sources, but now U.S. prices have moved higher, closing the arbitrage between the U.S. Gulf Coast and Middle East Gulf. There may be no further movements of Group I or Group II base oils from European sources due to the recent increases for domestic sales. It is assumed that these price increases would also apply to supplies to third parties, although affiliated receivers may be treated differently.

U.A.E. buyers continue to look at Group I options from Asia-Pacific, even after prices in that region had moved higher. The arbitrage may still be open due to the lack of alternative source. An alternative could be Indian suppliers, but another alternative is to increase taking Russian barrels at very low prices. Russian sellers are keen to maximize quantities into the U.A.E. and any other part of the Middle East Gulf, such as Kuwait and Bahrain.

Russian barrels are on offer to a number of buyers in the U.A.E., with Lukoil and Litasco looking for vessels to load out of either Limas, or at a push, out of Kaliningrad. Cargoes have been sent to Singapore from Kaliningrad, hence it could be possible to load a large vessel for both ports should draft at Svetly allow.

Russian base oil prices remain incredibly low and are suggested to be around $795/t for SN 150 and around $840/t for quantities of SN 500, discharged into Hamriyah.

Group III suppliers from the Middle East Gulf are looking to load further cargoes for India where demand has started to rise. Unseasonally, this surprise move has afforded the opportunity for producers in the U.A.E. and Bahrain to increase prices and also more extra barrels to the Indian market rather than Europe or the U.S.

The two large Shell cargoes into the west coast of India and Europe are on the water.

Netbacks for partly-approved base oils from Al Ruwais and Sitra refineries are maintained this week, since selling prices appear to have stabilized in Europe and may be rising in India. Netback returns are assessed at $1,440/t-$1,495/t, for 4 cSt, 6 cSt and 8 cSt partly-approved and non-approved Group III base oils.

Netbacks for Shell Group III+ GTL material out of Ras Laffan in Qatar are also maintained at around $1,520/t-$1,575/t. Levels are assessed on information received from traders in Singapore and also resellers in Europe.

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

Group II base oils resold FCA in the U.A.E. are sourced from European, the U.S., Asia-Pacific and Red Sea producers. Base oils are being sold ex-tank the U.A.E. or on a truck-delivered basis within the U.A.E. and Oman.

This week prices remain unchanged with levels assessed between $1,455/t-$1,485/t for the light vis grades 100N, 150N and 220N, with 600N between $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. It will be considered that prices may start to rise following source increases in U.S. and Europe.


No further information was received from South African sources in Durban regarding the latest large base oil cargo to be loaded out of Rotterdam and Fawley prior to sailing for Durban. No dates been released, but the quantity may be around 25,000 tons.

West African reports include the news of a vessel loaded out of Fawley with three grades of Group I base oils for receivers in Conakry in Guinea, Abidjan in Cote d’Ivoire and Tema in Ghana. The total cargo should be around 8,500-9,000 tons, with 5,000 tons of SN 150, SN 500 and bright stock going into Tema.

A regular Nigeria trader’s large U.S. cargo will arrive in Apapa during the next few days, and hopefully will start to discharge on arrival. Demurrage, and sometimes detention, can be a common feature of doing base oil business in Nigeria, and although vessels owners carefully log and prepare statements of demurrage, receivers often do not acknowledge this penalty, even if it is clearly stated in the contract signed between traders and receivers.

Often, traders receive none, or little recompense for demurrage, thus prices have to include an additional element to cover this cost. This may be the only cargo arriving into Nigeria for some time, with no news of a vessel loading out of Svetly terminal with Russian base oils. Nigerian receivers will be offered extended credit of up to 150 days following bill of lading date, and how payment will be arranged is not known, but at least some – if not all – of the amount will be in naira.

The U.S. arbitrage between the U.S. Gulf Coast and U.S. Atlantic Coast and Apapa is now closed, with U.S. prices having risen for Group I cargoes, with Nigerian receivers not looking to pay higher prices than currently offered. The cargo arriving into Apapa presently was purchased some time back by the trader involved, allowing the deal to be progressed. It has been confirmed that at current U.S. price levels it will be impossible to meet Nigerian buyers’ demand on delivered prices. Therefore, there may be an interlude in proceedings for a few months until Nigeria buyers accept that current prices cannot be repeated in the market as it stands today. 

Of course, the irony of the situation is that no doubt Russian prices will be well below levels established by other traders and that may destroy the market for regular traders for some time.

CFR Apapa prices are currently assessed at around $1,100/t for SN 150, $1,160/t for the SN 500 and SN 900 around $1,195/t.

It is considered that Russian offered prices will be at $100/t-$175/t lower than current delivered prices, keeping the door open for the further dumping of Russian barrels into this market. However, not all blenders in Nigeria can accept Russian specs and quality.

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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