Weekly EMEA Base Oil Price Report


Margins in Europe for API Group I base oils are being squeezed as crude oil and feedstock costs rise while prices for the base stocks remain steady.

Group I values are staying down despite several crimps to supply, including a recent fire at ExxonMobil’s refinery in Port-Jerome, France, and looming temporary shutdowns at refineries with Group I plants in Greece, Hungary and Spain.

The supply-demand balance within the region seems likely to tighten, which normally would create upward pressure on prices. Smaller margins could also prompt refiners to shift feedstock toward production of fuels, which would further shorten Group I supply.

In contrast, the Group II premium to vacuum gasoil is steady and acceptable at the moment. Producers applied price hikes late last year, and there has been little erosion to those increased values.

Then there is the Group III segment, where premiums to raw materials – based on prices for the 4 centiStoke grade – have shrunk to their lowest level since the second quarter of 2022, when feedstock prices rocketed because of Russia’s invasion of Ukraine.

Margins for 4 cSt oils with partial slates of finished lubricant approvals are border-line, and a large slug of replenishment cargoes about to hit the continent could further weaken the market. Such a development might remove some of the attraction of the European market for producers in Asia-Pacific and the Middle East Gulf.

Meanwhile, trading in the Middle East Gulf has been dulled by the beginning of Ramadan. Problems for shipping in the Red Sea are becoming worse, as Houthi rebels attacked a Chinese-owned tanker after promising safe passage to Chinese and Russian vessels. The Huang Pu, sailing under a Panamanian flag, was attacked on March 24. Details about damage and injuries are sketchy.

The Houthi attacks appear to be random and uncoordinated, but United States and United Kingdom ships are being targeted irrespective of connections to Israel.

Crude oil prices reached their highest for four months the past week, climbing above $88 per barrel for dated deliveries of Brent and Dubai crudes before falling back toward levels reported a week ago. Dated deliveries of Brent were at $86.80/bbl Monday, for May front month settlement, while West Texas Intermediate was at $82/bbl, down $1 over the week, now for May front month.

Low-sulfur gasoil also rose but then retreated to $20 lower than last week at $831 per metric ton, still for April front month. All of these prices were obtained from London ICE trading late March 25.


As explained last week, this column has stopped reporting about Group I exports from Europe as such activity has ceased. Once again, there were no reports the past week of even potential export trades. Should this situation change, then reporting on exports will resume. 

Prices for Group I sales within Europe are on an upswing and are firmer this week. A number of blenders across the region expressed concern about finding quantities to cover immediate requirements. Availabilities are moving shorter due to the closing of Eni’s base oil plant in Livorno, Italy – which was one of Europe’s largest Group I sources – and the turnarounds mentioned above.

Some suppliers in Spain have implemented price hikes. A number of traders in Europe are looking to take cargoes from the U.S. or other areas that make economic sense, perhaps signaling the direction of the European market.

Buyers who not long ago were preferring to rely on spot purchasing are now reconsidering term contracts. Sellers, who were encouraging contract at the end of last year now are not renewing them and are only able to supply to regular customers. One thing easing the situation is that demand for finished lubricants remains slow.

European Group I prices have firmed to between €925/t and €965/t for solvent neutral 150, €950/t-€1,025/t for SN500 and €1,035/t-€1,240/t for bright stock – wider ranges than reported last week due to the aforementioned hikes by suppliers in Spain. The dollar exchange rate to the euro is static, posting on Monday at $1.08375.

European Group II prices are steady, though crude and feedstock costs are causing some pressure. A major turnaround is starting at the ExxonMobil refinery in Rotterdam. Information gleaned from some customers suggests that the refiner is well prepared to accommodate regular customers but will not be actively looking for extra clientele at least until the maintenance is completed.

European Group II prices remain higher than most other regions, but demand is still weak, and importers from the U.S. are keen to increase shipments this year. There are some signs that demand may start to pick up during April, and sellers are ready to accommodate.

Prices in Asia-Pacific markets are rising, making the arbitrage to Europe marginal. With detours around Africa’s Cape of Good Hope adding freight costs, imports from Far East sources may become uneconomic.

A small parcel is arriving into Antwerp-Rotterdam-Amsterdam from South Korea, with 2,000 tons of 600 neutral offered at €1,260/t on an FCA basis. The quality of this material is excellent, comparing well to that produced by international oil majors in Europe or the U.S.

Prices for light Group II grades are unchanged at €1,020/t-€1,065/t, ($1,105/t-$1,155/t) for 100N, 110N and 150N and at €1,065/t-€1,100/t ($1,145/t-$1,195/t) for 220N, while those for 600N dipped to €1,155/t-€1,200/t ($1,270/t-$1,365/t). All of these prices apply to a range of Group II oils from Europe, the U.S. and Red Sea sources, all imported in bulk.

The Group II premium to diesel is around $375/t on average, up a little from last week due to diesel prices falling.

The Group III European market is braced for arrival of a number of replenishment cargoes over the next few weeks. Costs have risen due to detours away from the Red Sea and the Suez Canal. As mentioned, the premium over diesel is at its lowest since Russia launched its war against Ukraine, an event that sent crude costs and diesel prices sky high. Group III prices were much higher then, but the premium fell to very low levels.

The strike affecting the logistics and operations at Neste’s Porvoo, Finland, refinery was due to finish Monday but instead will continue through until the end of March. Neste have advised that Group III base oil production should not be affected, but cargo shipments could be delayed due to congestion on berths.

Two suppliers from Asia-Pacific are still offering lower prices than the main market, although in one case specifications and quality are lower than material from the Middle East Gulf and Malaysia, but this situation may change with increasing costs of shipping from South Korea.

European prices Group III oils with partial approvals or no approvals are unchanged at €1,555/t-€1,595/t for 4 and 6 cSt and at €1,565/t-€1,600/t for 8 cSt, all on an FCA basis ex Antwerp-Rotterdam-Amsterdam and Northwestern Europe. The two suppliers mentioned above are offering at €1,295/t-€1,365/t, but these numbers are not representative and hence are not included in the main ranges.

Rerefined prices are unchanged at €1,445/t-€1,495/t for 4 cSt, on an FCA basis ex rerefinery in Germany. A 6 cSt product is primed to come onstream from the same facility.

Group III oils with full slates of approvals are maintaining their premium over partly- approved grades and are assessed at €1,685/t-€1,725/t for 4 and 6 cSt and at €1,715/t-€1,745/t for 8 cSt, on an FCA basis ex hubs in Antwerp-Rotterdam-Amsterdam, Northwestern Europe and Spain.

Baltic and Black Seas

Baltic Sea reports contain news of further cargoes loading out of Saint Petersburg and Vyborg, but destinations for the parcels can only be guessed until the vessels’ arrival is recorded in discharge ports. Another large cargo of around 8,000-10,000 tons loaded possibly out of Vyborg again, this being a repeat cargo of the 6,000 tons that loaded towards the end of last year for receivers in Nigeria. It is considered that this cargo was done by a trader based in Minsk.

Russian cargoes moving to the United Arab Emirates and Singapore should be given safe passage through the Bab-al-Mandeb Strait by Houthi rebels, but after the strike on the Chinese vessel last weekend this may be in doubt, but it was announced in the national press today that a meeting had taken place between Houthi leaders and representative from Russia and China last week. This meeting was held in Oman.

Lotos material which was available from Gdansk did not go to export, with offered prices considered too low. The material was distributed into the local domestic market, where demand is rising against the dearth of availabilities in Northern Europe.

Russian FOB prices for SN 150 and SN 500 from St. Petersburg are indicated at extremely low levels, $505/t-$520/t for SN 150 and SN 500 at around $530/t. SN 900 could be available at around $565/t, using Russian SN 1200 or quantities of low spec Russian bright stock, blended with either SN500 or SN 150 to determine correct viscosity.

Turkish base oil markets have a continuing influx of Russian base oils but with comments from a number of blenders that there is poor demand for finished lubricants in Turkey. Low priced lubricants are coming into the Turkish market from the U.A.E., being moved by truck through Iraq, Kuwait, and Saudi Arabia because most container traffic in the Red Sea is currently suspended.

Inflation levels are reported as “officially” being at 68%, but many disagree with government-issued numbers and put actual inflation above 80%. The Central Bank is pushing interest rates ever higher to contain the levels. Russian base oil imports are thought to be conducted on a government-to-government basis, but details of this scheme are not available.

Russian exports of SN 150 and SN 500 are moving out of the Baltic Sea, discharging into Gebze port. These imports are in addition to material coming out of Volgograd refinery. Cargoes for the U.A.E. are being loaded out of Limas terminal and are being sent southward through Suez, transiting the Red Sea on the proviso of “safe passage” from the Houthi rebels in Yemen.

Tupras at Izmir issued new prices a couple of weeks ago that are still valid this week. Levels ex-refinery: spindle oil is priced at $965/t (Tl 31,116), SN 150 at $907/t (Tl 29,269), SN 500 at $861/t (Tl 27,784), and bright stock at $1,028/t (Tl 33,167). Prices in Turkish lira are ex-rack plus a loading charge of Tl 5,150/t.

Group II ex-tank prices remain at around €1,175/t-€1,195/t for the three lower vis grades – 100N, 150N and 220N – with 600N at €1,385/t-€1,475/t. Group II grades may be sourced from the Red Sea, the United States, South Korea or Rotterdam, although there may be some problems in obtaining Saudi and South Korean barrels, because of the Red Sea situation.

Partly-approved Group III base oils are sold FCA, with Tatneft 4 centiStoke grade still priced at around €1,420/t. Supplies that previously arrived from the U.A.E., Bahrain and Asia-Pacific remain at €1,575/t-€1,620/t FCA. but it is unclear how supplies from the Middle East Gulf and Far East will be effected. It will be uneconomic for cargoes to be re-routed via the Cape, then sail through the Mediterraneanm before discharging in Turkey. Alternative feeder cargoes may load out of Antwerp-Rotterdam-Amsterdam, following the discharge of a larger cargo.

Fully-approved Group III grades delivered into Gemlik from Cartagena in Spain and resold on an FCA basis have prices maintained at €1,920/t-€1,965/t FCA. A small bulk cargo of around 1,200 tons is recorded on shipping reports, although it may became more economic to load flexies and supply on a more regular basis.

Middle East

Red Sea reports are few, with the shipping problems, but one new movement has been detected. That is with the movement of a cargo of Group I base oils from Yanbu and/or Jeddah into Antwerp-Rotterdam-Amsterdam, where the material will be sold either FCA or delivered by truck or barge by one of the participant companies in the Saudi Aramco Group. This may be the first of many repeat cargoes, since shipping difficulties are limiting exports from Yanbu and Jeddah. The cargo is believed to have been loaded on a vessel that would have sailed south through the Suez Canal, loaded in one or both ports mentioned, then returning northwards. It would avoid the Bab-al-Mandeb Strait in the southern part of the Red Sea.

Other cargoes to the west coast of India and the U.A.E. remain problematic, with few vessels willing to take the gamble of the Houthi attacks. Some owners have decreed that no vessels will enter the Red Sea or sail close to Aden since protection and indemnity insurance clubs have forbidden any operations in that region.

Also, it is not clear how supplies of Group III base oils will be delivered to Yanbu, since in the past, quantities of usually 5,000 tons are loaded out of South Korea from S-Oil’s refinery at Onsan. The absence of Group III supplies could compromise the blending and formulations of finished lubricants in Saudi Arabia.

Middle East Gulf regions are slow due to the Holy Month of Ramadan that is currently in progress, with around another 10 days to go. Then the Eid al Fatr holiday takes over, and it will be at least until after that holiday before things start to get back to normal.

Sources in the U.A.E. maintain and confirm that Saudi cargoes from Luberef in Yanbu and Jeddah are being delayed and cancelled. No large cargoes are servicing ports such as Fujairah, Jebel Ali, Ras Al Khaimah and Hamriyah.

There was another reported attack on a Chinese vessel that is documented elsewhere in this report. As well as Chinese vessels, Russian cargoes will also be “granted safe passage.” How guarantees will be assured from the Houthis remains a mystery, with passage through the strait something like Russian roulette, no pun intended.

Russian base oils are routinely delivered into the U.A.E., with prices indicated at around $610/t for SN 150, with $640/t for quantities of SN 500. A parcel of around 5,000 tons loaded from Limas terminal in Turkey for receivers in Hamriyah. No further Russian cargoes were imported into the U.A.E. and then re-exported to Nigeria. This operation can be put together and even with high freight rates, the low delivered prices – providing low FOB levels – give these cargoes the edge. The cargo is deemed to be of U.A.E. origin, not Russian, which will satisfy receivers in Nigeria.

Group III netbacks for partly-approved base oils from Adnoc and Bapco were lowered, following new cargoes on vessels loading for Europe and the U.S. Levels are now maintained due to higher costs for freights to U.S. and Europe, which may have increased by $50/t-$80/t. Local selling prices remain steady, so netbacks will provide less contribution. FOB prices will require adjustment.

Netbacks are indicated at $1,460/t-$1,510/t, for the 4 cSt, 6 cSt and 8 cSt partly-proved and non-approved Group III grades. Netbacks for Shell gas-to-liquid Group III+ base oils from Ras Laffan in Qatar remain at around $1,475/t-$1,525/t due to larger cargo sizes providing lower freight rates.

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

Group II base oils sold ex-tank in the U.A.E., or sometimes on a delivered basis by truck in the U.A.E. and Oman. Prices are maintained having been raised last week due to increased freight costs from U.S. and Europe. Few, if any, cargoes are arriving from Yanbu because the market is tight, and it is at a time when demand will be high after Eid. Levels are at $1,685/t-$1,725/t for 100N, 150N and 220N, with 600N at $1,775/t-$1,825/t. The high ends of the ranges refer to road tank wagon deliveries to buyers in the U.A.E. and Oman.


South Africa shipping sources, although not directly involved, continue to suggest that a cargo from Singapore will supply receivers in Mombasa and Dar-es-Salaam, thus avoiding the Red Sea transit. A further large European base oil cargo will load in April out of Rotterdam and Fawley for discharge into Durban. The parcel is to be comprised of around 19,000 tons of base oils, but the exact quantity will depend on the vessel chartered.

A large 8,000/t-10,000/t cargo loaded out of the Baltic with three grades of Russian export barrels – SN 150, SN 500 and SN 900. The same trader who handled a smaller cargo in December to January is believed to have been involved in this deal. Dates are not declared, but if the cargo loaded during first half of March, the estimated time of arrival into Apapa should be around mid-April.

Reports were that some Nigerian receivers are not keen to take Russian cargoes because of fear of reprisals or sanctions but also due to reluctance from some blenders to use these substandard base oils in blends. But the driving factor – as with all trades in Nigeria –  is the price that will be pitched much lower than barrels sourced from the U.S. Gulf Coast or U.S. Atlantic Coast. Another “Russian” cargo re-loaded out of Hamriyah in the U.A.E. was delivered last year.

The reports of possible Indian and U.A.E. material being considered for further cargoes into Nigeria continue in talks in the U.A.E., but these discussions are at an early stage.

The large 18,000-ton cargo from U.S. has arrived in Apapa, and it is believed that discharge has been completed. The cargo was sold to multi receivers in Lagos. Landed prices are confirmed in the ranges below, but future cargoes from U.S. will have to have higher prices, because FOB levels are climbing and shipping costs are not getting any less. Offers of Russian material are keeping price expectations lower than traders would want, leading to difficult negotiations, with receivers on fresh cargoes planned for April or beyond.

CFR Apapa prices are confirmed and indicated in the same ranges as in last week’s report, at around $930/t-$950/t for SN 150, $1,000/t-$1,020/t for SN 500 and SN 900 at around $1,040/t-$1,060/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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