EMEA Base Oil Price Report


The war between Israel and Hamas continues to have a destabilizing effect on energy markets, creating uncertainty for base oil markets throughout Europe, the Middle East and Africa.

Coming on top of the inflation and high interest rates that were already hampering business, the conflict is interrupting supply chains. Producers and traders who supplied base oils imported into Israel and surrounding countries such as Egypt and Jordan are kicking their heels in frustration at not being able to pursue trade in a normal way.

Finished lubricant blenders in Israel are struggling to continue operating due to gaps in base oil supply. Lube distributors in the country are appealing for emergency supplies from sources as far away as Europe and the United States.

Some supplies of base oils have been getting into Israeli ports such as Haifa, Ashdod and Tel Aviv, but the hostilities have hit trade hard overall. Government and private enterprise are working together to support imports and exports of goods and services.

Meanwhile winter has set in in Ukraine where the war with Russia continues, apparently mired in a standstill. Both conflicts are disrupting trade near and far.

European base oil markets are witnessing some strange patterns at the moment, such as short supply of some light API Group I grades – solvent neutral 100 and 150 – pushing a number of blending operations to substitute light Group II oils.

This has helped to shore up demand for Group II base oils, since suppliers have seized the opportunity and are “suggesting” that buyers take quantities of 600 neutral along with the lighter grades.

The Group III picture remains unattractive for suppliers. A combination of surplus availability and decreasing demand are heaping downward pressure on prices as distributors and other sellers try to offload as much product as possible to regular customers. The oversupply situation will only get worse as more material becomes available from sources in Asia-Pacific, where demand is also falling.

Crude prices have slipped considerably as dated deliveries of Brent crude and West Texas Intermediate both decreased more than $4 per barrel since last week. Analysts attribute the slide to a drop in demand from major economies such as China and India. Russian crude supplies to those two nations are said to have continued unabated, and the production cutbacks the Kremlin announced some months ago do not appear to have happened.

Dated deliveries of Brent fell to $81.55/bbl, for January front month settlement, while WTI is at $77.25/bbl, still for December front month. Low-sulfur gas oil fell almost $90 over the past week to $801 per metric ton, now for December front month. These prices were obtained from London ICE trading late Nov. 13.


The European Group I market is relatively tight, especially for lighter grades, leaving no surplus quantities for the export market. Producers have reduced run rates until Group I availabilities are more or less in balance with regional demand.

However, the market is slowing as the end of the year approaches, and intra-regional sales rates may dip in coming weeks. Fire sales are still not expected next month.

Livorno still presents a confusing picture with reports that a problem in the VDU has suspended base oil production due to a lack of feedstock. Production is reported to be coming back on stream around the middle of this month, but when stocks of base oil will become available has not been announced. It is considered that it may take a couple of weeks flowing restart to have stocks available for sale, with prioritizing the local market being the primary concern.

Export sales could be considered as contracted barrels from a major going into receivers in Guinea, Cote d’Ivoire and Ghana from Rotterdam and the United Kingdom, the latest cargo loading from Fawley, U.K. The quantities are around 3,000 tons into Conakry, Guinea, and Abidjan, Cote d’Ivoire, and 5,000 tons to Tema, Ghana. Hence the total cargo will comprise of SN150, SN500 and bright stock, with each location taking three grades.

Export prices are notional at best, with SN150 levels maintained being assessed between $900/t and $950/t, SN500 remaining at $1,025/t-$1,100/t and bright stock also unchanged at $1,250/t-$1,335/t.

With the latest round of increases being implemented for Group I domestic supplies, levels are starting to become eroded with some suppliers offering sizeable discounts to larger buyers to take maximum quantities of heavy solvent neutrals. The resolution by producers not to crack, and to hold firm on the notified increases seems to have disappeared.

Lighter solvent neutral grades are in short supply with some producers without any availability. Bright stock is also tight with a number of refiners not committing to produce this material, saying that they do not want to build stocks of this grade prior to the year end.

Another cargo from Red Sea sources has been discharged into Antwerp with the marketing and selling being handled by an affiliated Saudi Aramco company from Korea to market the Group I grades within northwestern Europe. It was believed that the cargo was around 5,000 tons of three Group I grades, which will be used to supplement what is becoming a rather tight market, especially for light neutrals and bright stock.

With crude and feedstock prices coming off the recent highs there may not be need for further upward moves, with sellers now maintaining a very acceptable base oil price premium to diesel. The recent downward moves for diesel may start to create price pressure on Group I base oils, particularly for heavier neutrals.

Generally prices stay unchanged, but the with highs on SN500 taken lower due to comments received of discounting to achieve larger sales of SN500 and SN600. SN150 is at €1,165/t-€1,225/t, SN500 at €1,220/t-€1,265/t and bright stock at €1,375/t-€1,450/t.

The euro exchange rate to the dollar has moved slightly, posting on Monday 13th November at $1.06736, narrowing the price differential between exports and Group I sales within the region to €135/t-€195/t, exports being lower.

European Group II prices are steady following some of the large increases announced by one major supplier at the end of October. It would appear that some of the other players in the Group II market have not announced increases, and some of their customers claim their prices were already higher.

The Group II base oil premium to diesel has been resurrected since Group II base oils had been selling at an exceptionally small premium to diesel prices. The initial concerns from suppliers that price rises could weaken demand have not been realized with sellers commenting that demand is steady, with margins acceptable to producers.

Prices are adjusted at the low ends of the spreads and are now at €1,110/t-€1,220/t ($1,185/t-$1,280/t) for 100N, 150N and 220N and at €1,220/t-€1,355/t ($1,305/t-$1,425/t) for 600N. Typically 100N and 150N are priced higher than 220N due to demand and generally higher usage in Europe of the two lighter grades. These prices apply to a wide range of Group II base oils from Europe, the U.S., Asia-Pacific and Red Sea sources, imported in bulk and in flexie-tanks.

One supplier with imported material from the U.S. has offered prices which are much lower than the rest of the market but higher than previous levels from the same source, which were deemed incredibly low.

Group III prices are being chipped away, in smaller discounts that previously, but nevertheless the continuous process is eroding prices on an ongoing basis. Prices are set to remain weak, with re-refined prices showing lower offers than partly-approved products.

The combination of oversupply which is growing, and simultaneous lower demand is affecting the Group III market in Europe with both factors leading to continuing price pressures which have caused prices to collapse.

Fully-approved Group III base stocks, until recently, had been protected from price erosion seen for partly-approved material, but these fully-approved grades are now seeing lower prices but the large differentials between fully-approved and partly-approved grades are still in place to the tune of around $350/t.

Partly-approved grades, not including rerefined base oils, have prices for 4 and 6 centiStoke slightly lower at €1,445/t-€1,465/t. Eight cSt is now at €1,400/t-€1,430/t. Rerefined 4 cSt is offered at €1,345/t-€1,370/t. All of these prices are based on FCA supplies ex Antwerp-Rotterdam-Amsterdam Northwestern Europe and Germany.

Prices for fully-approved Group III base oils from Cartagena refinery are maintained. Many blenders continue to decline buying full quotas of fully-approved Group III base stocks with the price differential being significant.

It is heard that the Group III supplier from South Korea will not attain full-approvals until 2025. Fully-approved 4 and 6 cSt grades are placed at €1,825/t-€1,875/t. Small quantities of 8 cSt oils are assessed between €1,795/t-€1,820/t. Prices are in respect of FCA sales ex hubs in Antwerp-Rotterdam-Amsterdam, Northwestern Europe and Spain.

Baltic and Black Seas

Sources in Lagos suggested that no firm cargo has been booked as yet from Svetly in Kaliningrad for receivers in Nigeria. The doubts were around last week, when no news was heard from other sources in Nigeria that a vessel was fixed to take a cargo to Apapa. It would appear that there are a number of problems, with more than one receiver of part of the cargo unwilling to accept Russian quality and specifications.

The basic problems are color, viscosity index and oxidation stability, which are lower in value than mainstream Group I base oils from either Europe or the U.S. There also appear to be some problems as to the payment structure, with potential buyers opting to pay in naira. That would require representation “on the ground” in Lagos to accept naira and then exchange the local currency into dollars on the “alternative” market. This process can be tricky, and dollars then have to be remitted out of Nigeria, which can also become another impediment to making the transaction work. 

The cargo may still happen, but no vessel has been fixed as yet to make the voyage. There are still rumors that a parcel of around 12,000 tons is being prepared for loading, but this will ultimately depend on vessel availability, and the size of the vessel will dictate final quantities to be loaded. The cargo will comprise of quantities of SN 150, SN 500 and SN 900, which will be blended, perhaps using SN 1200 or Russian quality bright stock.

FOB prices for SN 150 and SN 500 from Svetly are heard to have risen, in line with increases to base oil prices within Russia. Levels are now estimated at around $745/t for the SN 150, with SN 500 now around $760/t. SN 900 could have an FOB price of around $790/t. Sellers could land a cargo with prices around $200/t lower than current prices landing in Apapa.  

Cargo lots coming into the Baltic now form part of the new supply chain taking over from Russian supplied material. Imports of virgin base oils from Europe, the United States and the Middle East are represented by cargoes going into Lithuania and Latvia. Additionally, rerefined Group I from Denmark and rerefined Group III base oil from Germany also contribute to the new supplies going into the Baltic.

There are still rumors and talk of Russian base oils smuggled into the Baltic states. This practice has been continuing since the official European Union ban in February this year, when all “contracted” supplies had to cease. Material is taken by truck, and using non-policed border crossings is sold to blending operations in Latvia and Lithuania, where the Russian product is mixed with other legal base oils before being used for “EU produced and sourced” finished lubricants.

Gdansk refinery reported some production problems last week, and it is not known when, if at all, product will be made available for export to receivers in the United Kingdom or Scandinavia. There were talks that supplies from Gdansk may be sent to Italian buyers once again, with the problems locally at Livorno refinery, but nothing was confirmed on this subject. Traders were looking to lift a cargo for the west coast of the U.K., but with no availabilities, this possibility looks remote.

In Turkey another offer for a Greek cargo has been with Turkish buyers requiring European quality Group I base oils. The problem remains with European mainland prices versus Russian barrels, but two blenders in Turkey have said that they must access European quality base stocks to meet approvals on finished motor oils, which would be blended using these oils. Price is the main issue, and offer may again not work into Gebze or Derince.

The economy in Turkey continues to pose a major headache for imported material coming in from European sources, with a number of potential suppliers openly admitting that they would not have the quantities of material, such as SN 150 or bright stock, available to supply a cargo.

The Turkish lubricant market is almost dependent on Russian imports of SN 150 and SN 500 to supply blending operations across Turkey. Additionally, there are small quantities of Russian quality bright stock and mid and heavy neutrals available from an Uzbek supplier.

Imported Russian Group I base oil prices are heard to have moved further, with reports that levels have increased by around $60/t-$75/t. With raw material costs rising, the production costs of Russian base oils have to rise, although how the barrel economics are worked out is a complete mystery. Sources have indicated SN 150 at around €875/t, with SN 500 at €895/t.

Tupras production apparently has not restarted and may be operational towards the end of November.

There are still products in stock from existing production with prices remaining until stocks are depleted. Prices for SN 150 are put at $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). Prices in Turkish lira are ex-rack plus a loading charge of Tl 5,150/t.

Group II prices ex-tank remain unchanged with levels around €1,255/t-€1,300/t for the three lower vis products – 100N, 150N and 220N – with 600N at €1,475/t-€1,525/t. Supplies of Group II grades may be sourced from the Red Sea, the United States, South Korea or Rotterdam. Some traders are active in these supplies, with material in flexies delivered to Turkish receivers, which resell on an FCA basis.

Partly-approved Group III base oils resold on an FCA basis, or often on a truck-delivered basis, are maintained, with Russian 4 centiStoke grade from Tatneft at €1,345/t. Alternative supplies are at €1,525/t-€1,575/t FCA, depending on quantity purchased.

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

Middle East

Base oil prices from Yanbu and Jeddah for Group I base oils had increased by around $50/t, but apparently prices were readjusted again and have moved upwards by a total of over $110/t for Group I grades. Group II prices are also increasing in line with a European major, with increases of around $130/t applied. These prices are not posted on an FOB basis but are reflected on CIF/CFR delivered numbers. Receivers in India and the United Arab Emirates have confirmed that Luberef prices have moved upwards and are now being negotiated for future deliveries. 

Large cargoes loading out of Yanbu and Jeddah are moving to the west coast of India and the U.A.E. These cargoes provide European quality in terms of Group I barrels and also major specifications when looking at Group II supplies out of Yanbu.

The cargo delivered to northwest Europe was loaded in Yanbu during early October and discharged in Antwerp.

In the Middle East Gulf, all eyes and ears are on the chaos going on in Gaza, with many players fearing that the conflict could spread to other countries in Middle East, including participation on an indirect basis from Iran. This could upset the relative calm of the Gulf and could initiate problems for all involved in the lubricants industry in the region.

Group I and Group II base oils are arriving in the U.A.E. from various sources, from South Korea, Singapore, and Rayong in Thailand. The arbitrage between the U.S. Gulf Coast and Middle East Gulf is not open at the moment. U.S. prices, having been lifted during October levels, have stuck at the new levels, ruling out competitive barrels arriving into the U.A.E. from that source. Europe is not in a position to supply Group I barrels into Middle East Gulf receivers due to reasons explained elsewhere.

U.A.E. buyers are between a rock and a hard place at the moment, with no options to look to from the U.S. or Europe. In looking at Group I options from Asia-Pacific, availability is there, but FOB prices have gone high, making those sources uncompetitive. U.A.E. buyers are negotiating with Luberef to buy large quantities of both Group I and Group II base oils, with a number of large cargoes being talked, with up to 20,000 tons each arranged for receivers in Fujairah, Hamriyah and Jebel Ali. Even with Luberef’s price increases, this source may be the only option to purchase quality base oils at the moment.

Lukoil and Litasco continue to offer Group I and Group III base oils to receivers in the U.A.E., mostly from Limas terminal in Turkey. But with the Volga River starting to freeze, this operation may change during the winter months, with other options of loading vessels from Svetly in the Baltic. Freight will be more expensive, but this option may be more economic than trucking material from Volgograd to Novorossysk on the Black Sea.

The 4 cSt Group III prices from Tatneft, but resold by Lukoil, are competitive versus local supplies from Adnoc and Bapco.

Russian base oil prices are reported to be around $875/t for SN 150 and around $895/t for quantities of SN 500, discharged into Hamriyah port.

Group III suppliers Adnoc and Bapco are loading a number of cargoes for the western coast of India where demand had boomed but has now settled back with reports that demand is actually falling. This is a contradiction to news heard a couple of weeks back, but South Korean refineries have completed turnarounds and are now back, with full availabilities and a lack of buyers in Asia-Pacific markets that have become dull.  It is imagined that sellers from Korea will try to maximize quantities into India, thus perhaps forcing Middle East Gulf suppliers to “sharpen their pencils” to maintain market share.

Netbacks for partly-approved base oils from Al Ruwais and Sitra are maintained this week, with selling prices only slightly lower in Europe, stable in India and rising in the U.S. Netbacks are assessed at $1,430/t-$1,475/t for 4 cSt, 6 cSt and 8 cSt partly-approved and non-approved Group III base oils.

Netbacks for Shell Group III+ gas-to-liquid base oils from Ras Laffan in Qatar also remain unchanged at around $1,520/t-$1,575/t. Levels are assessed on information from traders in Singapore and 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. may be sourced from European, U.S., Asia-Pacific and Red Sea producers. Base oils are sold either ex-tank U.A.E., or on a truck-delivered basis within the U.A.E. and Oman.

Prices are maintained, with levels at $1,565/t-$1,595 for the light vis grades 100N, 150N and 220N, with 600N at $1,695/t-$1,760/t. The high ends of the ranges refer to road tank wagon deliveries in the U.A.E. and Oman.


South African sources in Durban confirmed the large base oil cargo loading for ExxonMobil out of Rotterdam and Fawley. The vessel will proceed to Durban and finally discharge part-cargo in Mombasa. There may be an option on the vessel to include Dar-es-Salaam for a further delivery, but this is not disclosed at this stage. Loading laycan is given as Nov. 20-25 in Rotterdam.  

Reports from Nigeria suggest that the Russian base oil cargo for Apapa may not yet have been finalized as yet, with rumors of problems on base oil specifications and also financing. This report cannot confirm that a Russian base oil cargo will sail for Apapa, with no indications on any shipping list of any vessels being fixed from Svetly terminal. With information scant, to say the least, it is not impossible that a vessel has been fixed and loaded, although sources in Lagoa have not been able to confirm one way or the other if this cargo is going ahead. There is no information available from the Russian suppliers. The cargo size is also an unknown, since there has been no vessel identified as yet. A vessel could load a rumored quantity of around 12,000 tons of three Group I grades – SN 150, SN 500 and SN 900.

A trader’s large U.S. cargo had completed discharge last week, and our source has announced that as of now they will not be seeking to take another U.S. cargo for November loading, with only a possibility for December. Massive problems continue with the exchange rate between the naira and the dollar, since it is thought that a large part of the cargo will be settled in naira. That currency would then be exchanged on the alternative market for dollars to be transferred back to the trader in Switzerland. The source was enroute to Lagos last week to attend to the payment of the cargo, a rather onerous task. Hopefully, no demurrage was incurred during the discharge.

Traders are investigating alternative sources, one of which is Yanbu in Saudi Arabia, but one problem could be that Luberef may not sell base oils on an FOB basis to a third party. All other base oil movements out of Yanbu are done on vessels chartered by Luberef, and deliveries to various locations are performed on a CIF/CFR basis. Becoming involved in a delivered cargo in Apapa may not suit the logistics and working practices of Saudi Aramco.

CFR Apapa prices for the large U.S. cargo remain as reported last week and are confirmed at around $1,100/t for SN 150, $1,160/t for the SN 500 and SN 900 around $1,195/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.

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