The on-off peace negotiations between U.S. and Iran appear to continue in Switzerland, although there have been walk-outs from the Tehran contingent from time to time, with the additional threats to close the Strait of Hormuz again.
Frankly, it has become so difficult to appraise the progress of talks between the two parties, and given that the 60-day negotiation period commenced last week, the ceasefire continues to have been breached by both sides on numerous occasions.
The one outstanding issue appears to be the reluctance of Iran to control and close down its proxy in Lebanon, Hezbollah, which continues to strike Israeli targets. Israel have declared that they claim the right to defend their borders and have launched attack after attack into Beirut and other parts of southern Lebanon where Hezbollah are still entrenched.
these Israeli strikes have caused some division between Trump and Netanyahu, with the U.S. President calling for Israel to cease bombing targets in Lebanon. Israel maintains that it is merely defending itself.
Tehran do not appear to be taking any action to reign in their proxy, and probably continue to support that organisation by rearming and supplying weapons through Iraq and Syria.
The other Iranian proxy in Yemen have also been active with an attack on a merchant vessel at the end of last week in the Gulf of Aden.
Iran appears to be content to continue driving wedges between Washington and Tel Aviv, which only woken U.S. negotiating positions during talks.
At this point in writing this report, it is not confirmed whether the Strait of Hormuz is open or closed, such is the surrounding confusion.
Qatari reports early this morning, have confirmed that during an attempt to restart LNG operations at the Barzan facility an explosion tore through the terminal on Sunday night killing 13 people and injuring 66 others. The scale of the damage remains unknown, but this event will further impede the restart of Group III+ base oils production from the GTL process.
The alternative conflict between Ukraine and Russia has seen Ukrainian drone strikes on Moscow, hitting a refinery causing fires and widespread damage.
Putin has sworn revenge attacks on Kyiv, targeting civilian buildings and transportation. Ukraine also hit targets in Crimea, resulting in the closure of the bridge connecting the peninsula to the mainland. Russia responded by hitting Zaporizhzhia.
Base oil prices across the European, Middle Eastern and African regions are seeing numbers relaxing from the dizzy heights attained during the last month. Availabilities of Group I and Group II have improved, but not to excess.
Group III remains the main problem within the European arena, with a number of distributors nearing the end of stocks in tank, and with zero chance of any replenishment for these barrels any time soon, the market is facing shortage of these grades.
Supplies from European local production and alternative imports from AsiaPac cannot offset the shortages caused by the loss of availability from Qatar, Bahrain and U.A.E..
Blenders are looking for ways around this dilemma, with many scouring the market for any availabilities of PAOs, for which prices have extended rises over the past few weeks. Those unfortunate enough not to lay hands on these products, are examining alterations to blends and ASTM standards which could allow Group II base oils to be used to a greater extent, allowing the blending of critical finished lubricants for the automotive and industrial markets.
Additive suppliers have also been involved and have been instrumental in introducing steps to facilitate blending operations to continue uninterrupted.
Prices are being discussed between buyers and sellers particularly in respect of Group I and Group II grades, where buyers claim that base oil prices escalated quickly when the Iran war broke out, and when crude and product prices moved swiftly higher, and that base oil numbers purely reflected replenishment values. Now petroleum product prices have stabilised and have come down significantly from the highs, when base oil premiums were established above distillate levels. The argument is should base oil prices not fall to reflect a more realistic premiums over diesel prices for example?
The short answer is probably, but refiners claim that base oils being sold presently were produced when feedstock prices were higher, and that raw material costs have to be covered.
This situation has produced something of an impasse between buyers and sellers, with buyers holding off and only purchasing immediate requirements, waiting for base oil prices to come more into line with distillate levels.
Whist the above may be the case for Group I and Group II base oils in the European, Middle Eastern and African regions, sadly this is not the situation for Group III grades, where prices continue to escalate for the remaining barrels left in tank from Middle East Gulf sources.
Estimates are that around 160,000 tons p.a. of Group III entered the European market sourced from the three producers in Middle East Gulf. Local and alternative imports cannot cover this shortfall, with some distributors looking to sources elsewhere to find material. U.S. sellers are looking at the European market, where prices are substantially higher than U.S. selling levels, tempting U.S. suppliers to perhaps look at moving cargoes to Europe.
The question being posed however, is how long will European Group III prices remain at the high levels attained over the past couple of months, and if the shortfall is covered, then will prices start to fall….
Crude and Gas Oil Prices
News emanating from Switzerland appears to suggest that terms are being accepted by both U.S. and Iranian representatives at the negotiating table and that final agreement to a peace plan may be in sight.
This news has propelled crude prices lower, almost returning to levels seen just before the U.S. and Israel attacks on Iran on 28th February.
The lynchpin as a measure of success will be the permanent opening of the Strait of Hormuz to all marine traffic on a free transit basis, without the ‘Iranian Tollbooth” threat.
Iran’s Foreign Secretary has announced that all oil and petrochemical cargoes are now able to transit Hormuz and that the blockade has been lifted.
Goldman Sachs Bank has called crude prices lower for September and October front months, with levels around $71 per barrel average for the remainder of this year.
Dated deliveries of Brent crude: $77.60/bbl, August front month
West Texas Intermediate: $73.55/bbl, August front month
European low-sulfur gas oil: $878/t, July front month
Prices were obtained from London ICE trading late Monday June 22.
Europe
Group I base oil availability continues to improve, although heading towards the summer holiday period, demand appears to be slowing, with a number of blenders commenting that they have sufficient stock now in tank to take them through September, with all contracts for finished lubricants being covered.
Positive news coming out of war negotiations are taking further pressure off prices moving any higher, with a number of sellers reacting by offering lower levels.
Buyers are holding back from purchasing large quantities of Group I base oils with an end to the war being in sight.
Producers are between a rock and a hard place, with high value feedstock stocks having been utilised to produce Group I base oils over the last couple of months, and now with a potentially ‘fluid and adjusting’ market, it may be difficult to reconcile raw material costs versus current selling prices.
Buyers’ counter is that producers sold base oils ex tank at inflated prices immediately following the surge in crude and feedstock prices at the start of the war, and now there has to be a balancing act where selling prices will have to move lower.
To be objective, the prices increases were partly caused by sudden increased demanding shrinking availabilities caused by shifts to distillate production and a couple of refiners having production problems.
Export sales will still remain elusive with Group I imports currently being offered FCA from cargoes recently arrived from Saudi Arabia.
One major continues to send large cargoes to affiliated companies in Singapore and South Africa, and also to contracted buyers in West Africa. In some other reports these large cargoes are described as European exports, but largely are to affiliates, snd also rebalancing global stocks.
Prices are maintained in wide ranges with some majors retaining high ‘posted’ type prices, but offering discounted net prices to a select number of buyers. The high ‘postings’ remain without any announcements of price reductions.
Group I
European exports, FOB
No current prices
Northwestern Europe, FCA Antwerp-Rotterdam-Amsterdam
SN150 : $1,870/t-$2,200/t
SN500 : $1,900/t-$2,350/t
Bright stock 150 : $2,150/t-$2,580/t
Eastern Europe, FCA
SN150 : $2,285/t-$2,355/t
SN500 : $2,440/t-$2,530/t
Bright stock 150 : $2,625/t-$2,700/t
Mediterranean, FCA Spain, Greece, Italy
SN150 : $2,340/t
SN600/500 : $2,465/t
Bright stock: Only small quantities available. Prices on demand
Pan-European, FOB/FCA have prices maintained
SN150: €1,720/t-€1,857/t
SN500/600: €1,785/t-€2,180/t
Bright stock 150: €2,200/t-€2,390/t
Pan-European prices are assessed on an aggregate basis using prices from Scandinavia, Poland, France, Germany, Benelux, Spain, Italy, Greece, the United Kingdom, and Baltic States.
The euro’s exchange rate with the U.S. dollar was $1.14357 Monday.
European Group II base oil prices remain relatively high when compared to Group l, but whilst major suppliers are maintaining their ‘posted’ levels, there are reports of discounts and TVAs being applied to purchases of Group II base oils. With crude and feedstock values remaining lower following the news on negotiations from U.S. and Iranian sources, the odds are that Group II numbers will start to soften over the next few weeks.
Demand remains good for these grades, but with adequate stocks in tank, buyers are reluctant to lift large quantities of these grades. Some buyers have to purchase relatively large quantities if delivery is being made by barge, wit some buyers opting to take truck deliveries rather than tie up capital in large inventories.
Truck deliveries are more expensive to deliver, with price differentials versus barge rates of more than $75/t in some cases depending on distance from hubs.
Buyers are claiming that levels should be brought into line with an acceptable premium over diesel, which has retreated again during last week. the average premium for all Group II grades prior to the Iran war was around $450/t, whilst at the moment, the average premium is around $2000/t.
Price levels are recorded at levels seen during last week at around $2,625/t in respect of the 150N grade, with 600N at $2,765/t. Prices are on the basis of FCA sales Antwerp-Rotterdam-Amsterdam.
The European Group II supply slate will be increased later this year, when PK Orlen commence production at Gdansk refinery.
Supplies of Group II base oils are currently arriving from Saudi Arabia with cargoes from Yanbu. With the European market traditionally having typically higher prices than alternative markets such as India and South Africa, there is an appeal to producers to target the European market.
Prices are taken lower, with levels heard at around €2,425/t-€2,570/t in respect of the 100N and 150N grades, with 600N between €2,550/t-€2,680/t.
Group II, FCA basis
110N: €2,385/t-€2,470/t
150N: €2,395- €2,490/t
220N: €2,365/t-€2,485/t
600N: €2,510/t-€2,625/t
Prices refer to a wide range of Group II base oils which may be sourced from within Europe, and also imported from U.S., Red Sea and Asia-Pacific.
Even if the the Strait of Hormuz re-opened tomorrow there would be little chance of moving any Group III cargoes from Al Ruwais. the current situation remains too volatile for traders to get involved in looking for vessels, putting that vessel on the berth and sailing the ship to Antwerp-Rotterdam-Amsterdam.
No Group III base oils will be arriving from Sitra in Bahrain or from Ras Laffan in Qatar, due to damage to the facilities at those refineries. As already reported elsewhere in the report, there has been a massive explosion at Ras Laffan, which will further delay any resumption to GTL base oil production.
Logistical problems rule out alternative routes to getting Group III base oils out of the Gulf, with routes fully taken up with other materials moving out, and availability of containers and space remains an impossibility.
European buyers are vainly searching for alternative suppliers of Group III base oils, but established suppliers who will have stocks of Group III have their own portfolio of customers, many of whom have purchased Group III base oils from the same supplier for many years.
There are rumors that some U.S. traders may look at the European market, but the U.S. is also net short of Group III base oils right now, but, prices are lower in the U.S. with European price levels still moving higher, approaching $3500/t for 4 centiStoke product.
Fully-approved Group III cargoes are loading out of Cartagena in Spain. Another vessel has loaded and will arrive in Antwerp towards the end of June or early July.
The facility in Cartagena, having delayed planned maintenance earlier this Spring, will go into turnaround in late summer. It is not known how long production will be out, but this operator has vast experience and will cover requirements at the time.
Group III prices in respect of partly-approved material, FCA Antwerp-Rotterdam-Amsterdam and northwestern Europe, are pushed higher purely on the basis of diminishing availabilities, with one distributor confirming that tanks will be dry at the beginning of July.
Prices are increased.
Group III
Partly approved oils, FCA Northwestern Europe
4 centiStoke : €3,395/t-€3,425pmt
6 cSt : €3,395/t-€3,430/t
8 cSt: €3,250/t-€3,295/t
Fully approved, FCA Antwerp-Rotterdam-Amsterdam, Spain
4 centiStoke: €3,395/t/t-€3,445/t
6 cSt: €3,380/t/t-€3,420/t
8 cSt: €3,425/t/t-€3,460/t
All the above products sold on a delivered basis will be subject to transportation charges, added to the prices above.
Re-refined Group III prices are taken higher. Sellers are holding back from offering extra quantities of these grades, with buyers receiving allocations based on historical purchases. New production from one re-refiner will not come on-stream until September.
Rerefined Group III, FCA Germany
4 centiStoke : €3,120/t
5cst : €3,125/t
6 cSt: €3,125/t
Baltic Sea
Russian domestic base oil prices have apparently moved higher again, with many rumors circulating that because of a number of drone strikes on refineries deep within Russia, production of base oils along with fuels have been severely disrupted, with rationing and shortage reported from a number of regions.
No specific attacks have been confirmed on base oil refineries, but it is thought that the Bashneft refinery at Ufa was badly damaged and may have halted base il production.
There are no reports of Russian base oil exports loading or leaving Baltic ports, and with Ukrainian strikes on facilities at St Petersburg terminal there may be damages.
Rumours heard around the market were also suggesting that trains taking base oils from refineries to shore terminals were being targeted and were slow to discharge due to Ukrainian drone attacks.
Black Sea & Turkey
A cargo has been noted loading out of South Korea for receivers in Turkey. It is thought that this cargo will comprise of Group II base oils and may be sourced from GSC in Korea. the size of the cargo is not defined, since the parcel is loaded on a large vessel carrying a number of parcels for several receivers en route in India and South Africa.
It will be fascinating to see if the vessel transits the Bab-al-Mandeb Strait in the southern Red Sea, where Houthis have been active, targeting a vessel late last week in the Gulf of Aden.
Base oil supplies from Iran have been halted due to the war, and no Russian base oils are available for import into Turkish buyers. This is causing real problems for Turkish blenders, who are constantly looking for sources for low cost Group I base oils.
The Turkish market is extremely short of base oils and the cessation of hostilities between U.S. and Iran may be a lifeline to Turkish blenders.
Blenders in Turkey are looking to Azeri and Uzbek sources, but logistics are difficult and expensive, and the full range of Group I grades is not available, with heavier solvent neutrals missing from the Uzbek slate.
Turkish blenders continue to purchase Group I base oils from AMOC and APC in Alexandria Turkish buyers are also looking to Algeria to see if they can source barrels from Sonatrach. Is it not known if this will be Algerian produced material or whether supplies may be considered from Augusta in Sicily.
The product from Augusta holds REACH status, whilst the material produced in Algeria does not have this approval.
Turkish buyers have approached ExxonMobil again to investigate if they can purchase Group I and Group II base stocks from this supplier. Prices are believed to be too high for consideration by Turkish buyers.
Group I, ex rack Izmir refinery
Spindle oil: Tl 77,857.00/t plus, KDV Tl 18,511.30/t
SN150: Tl 76,676.00/t plus, KDV Tl 17,364.50/t
SN500: Tl 78,411.00/t plus, KDV Tl 17,711.50/t
Bright stock: Tl 94,765.00/t, plus KDV Tl 20,982.30/t
Sales incur a standard loading charge of Tl 10,146.50/t and should be added to the prices above.
Traders in Turkey have advised no sale offers will be forthcoming for Group II, although with a cargo from GSC on the way, two Turkish traders offered numbers which were around $100/t higher than the levels at the height of the Iran war for European FCA sales.
Needless to say, these numbers were designed to scare buyers.
Traders/blenders will use this material to blend locally, selling the finished lubricants, with revenue generated being required to finance replenishment barrels for example from Korea, to continue blending finished lubes for the Turkish market, and also other regions such as Ukraine, Greece. and North Africa.
One of the largest blenders in Turkey accounted for around 9,000 tons of finished lubricants imported into Ukraine during 2025. These lubes were for automotive, and Industrial end use.
Group III
Partly-approved
Tatneft 4 centiStoke FCA: no avails.
There have been no Turkish imports of Russian base oils, including Group III, for months.
Fully approved Group III from Cartagena, Spain, is no longer entering the Turkish market through Gemlik. This business may be resumed some time in the future.
Middle East
Cargoes loaded from Yanbu during May have arrived in Antwerp-Rotterdam-Amsterdam, with one cargo loaded around mid May and a further two parcels loaded at end May which are still to arrive for discharge. These parcels should arrive during this week
The large cargo which loaded for Fujairah the vessel is now sailing to discharge the remaining cargo in Chennai. It was advised that the vessel would call at Mumbai anchorage, this was misreported.
A cargo of Group II base oils has loaded or is loading promptly for discharge in Durban.
Last week was extremely confusing with Trump and Netanyahu a odds over attacks on Hezbollah positions in Beirut and southern Lebanon.
Tehran was unable, or unwilling, to intercede to defuse the situation with their proxy and whilst Hezbollah continued to strike Israeli settlements in the north, the IDF was unable to fully engage with the enemy to protect Israeli citizens and their borders.
Some influence appears to have been brought bear, with Hezbollah no longer sending missiles and drones into Israeli territory.
The sixty day ceasefire is underway, with both U.S. and Iran accepting each others’ terms for a cessation of the war. The terms are rather obscure, but news is gradually filtering out with the main points being publicised later this week.
The process will include the complete re-opening of the Strait of Hormuz to merchant marine traffic, this is fundamental to global economies, but even after opening it will take considerable time for vessel’s lying at anchor on both sides of the channel to transit and head to discharge, or to home.
The two vessel owners/operators approached a couple of weeks ago have confirmed that they are ready and willing to make the transit through Hormuz and to make passage to Hamriyah to discharge base oil cargoes on board. This exercise could still take a couple of months before berths are available.
Base oil prices in United Arab Emirates spiked during the early days of the war, but with no product left in storage, there are no reported FCA sales or prices.
Even if cargoes are discharged into shore storage, assessing prices to be set on these supplies remains vague, with some companies stating that they are having to pay demurrage charges to vessel owners prior to the cargoes being discharged.
These sums are not insignificant with one U.A.E. receiver advising that they will have to remit around $1.4 million before the cargo can be discharged into tank. The value of the cargo is assessed at around $11.4 million, so demurrage is an unwelcome addition. Prices would have been set prior to the Iran war, so levels may be lower than market at the moment, but how long high prices will persist is anyone’s guess.
Supplies of Group II base oils which were in storage are all gone with prices suspended until new cargoes can be discharged. Small quantities are coming in to a limited number of blenders, arriving by truck and rail from Fujairah, but quantities are not being resold, being used in blending to produce small quantities of finished lubricants for local markets, including contracts for military and civil government.
Group II
110N, 150N and 220N: Prices suspended
600N: Price suspended
Group III base oils, FCA Hamriyah/Sharjah port, or delivered by RTW in U.A.E. and Oman, are available from Adnoc at Al Ruwais. Quantities are not large, but further difficulties are in finding other base oils to blend with Group III, and also accessing supplies of additives required to meet formulations
Thus demand is slow with prices unconfirmed.
The distributor in U.A.E. temporarily closed, when the was started, but has now re-opened operations on a very small scale. Sales are extremely slow, with trade only resuming following the permanent opening of Hormuz, when cargoes of base oils and containers full of additives can be made available.
Prices are suspended for the moment. Netbacks in respect of Group III base oils ex Al Ruwais, Sitra and Ras Laffan are suspended for the time being.
Africa
The cargo of base oils which arrived into Mohammedia in Morocco ma have been under the auspices of a U.S. major delivering Group II base oils into a distributor in that country. it is not known whether that distributor is using the old Samir blending plant or shore tanks which were decommissioned some years ago.
A cargo around 3,000 tons of bright stock has been derived into Alexandria under the EGPC contract. The cargo loaded out of Yanbu, and may yet still to arrive in the port.
The large cargo of Group II base oils that recently loaded out of U.S. Gulf Coast for receivers in Durban has discharged the part-cargo for Durban and will now discharge the remainder in Mumbai.
Another large composite base oil cargo has loaded out of Rotterdam and Fawley for a major, supplying distributors and affiliated companies in South Africa. The vessel should discharge in Durban during second half July AGW.
The supply to Ghana, Guinea and Cote d’Ivoire has been completed from agents’ reports, although the last port Conakry has yet to confirm all completed. once again this report has tried in vain to access landed prices for these supplies, but so far has been unsuccessful.
This cargo has been mis-reported again, with another base oil publication stating that the cargo was bound for Nigeria. This is categorically not the case.
There is no new activity from Nigeria, and having talked with a trader who had recently visited Lagos, it would appear that there is very little appetite for looking at new possible cargoes.
The rainy season has started and business has slowed down, which is possibly just as well, since receivers in Lagos have not been able to raise local prices to realistic levels, to take account of replenishment cargoes for the future.
There are a number of negatives in trading base oils into Nigeria at the moment.
Firstly, receivers are unable to contemplate paying more than $1,900/t-$2,000/t CFR for SN500, which is currently too low for any trader to consider, given that current FOB, plus freight, plus margins would come out at around $2,750/t.
Only when supplies become tight and stocks are low in tank will the local prices stand a chance of moving higher.
Finance will be a major issue at the current inflated price levels, with the dangers of back-trading and non-performance leading to traders demanding full coverage for any cargoes under a letter of credit. Buyers have reacted with shock and horror at this suggestion, have been molly-coddled over the past few years with open credit, payment in naira, and extended terms.
The Nigerian market will have to adjust to international prices, and that is not happening a this time, hence traders will be extremely reluctant to enter into supply negotiations for cargoes at this time.
Also looking to the USG and USAC sources for Group I base oils, is nigh impossible right now, due the hurricane season approaching and refiners building inventories as insurance agains any possible problems. So without availability of products, prices all wrong, and financial risks unacceptable, Nigeria is not a place to be doing business at this moment in time.
The Nigerian unofficial naira exchange rate is NGN 1,395 to the dollar, as of 22nd June 2026.
No new offers have been made, nor will be made.
For the sake of historical value, cargoes which arrived into Apapa, sold at prices valid prior to the Iranian war. Levels were around the following numbers.
Group I, FCA Apapa
SN150: $885/t
SN500: $925/t
SN900: $1,035/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.
Historic and current base oil pricing data are available for purchase in Excel format.