Global Base Oils Supply-Demand Balance Stays Tight In November
Global demand rises more than 10% year on year, outpacing supply growth and keeping market fundamentals tighter than usual
Global surplus stays nearly 40% below year-earlier levels, reflecting sustained consumption growth in US and Asia
Continued demand expansion will be critical as new production capacity ramps up and adds to global supply
The global base oils supply-demand balance stayed tighter than usual in November as sustained demand growth slowed a build-up of surplus volumes despite steady production and new capacity additions.
The surplus of global base oils supply over demand widened to more than 370,000 tonnes in November, rising from less than 200,000 tonnes in October but still down almost 40% year on year, government and industry data showed.
Tighter market conditions cut the cumulative surplus in the three months to November to less than 900,000 tonnes, down from more than 1.10 million tonnes in October and close to the lowest level since the first half of 2024.
The lower surplus underscored the resilience of global base oils demand and highlighted the importance of consumption growth in offsetting the factors supporting a pick-up in base oils supply.
Key Highlights
· Global demand rose by more than 10% year on year and for a fifth straight month in November, even as consumption slipped from October’s levels.
· Demand growth was led by the Americas, where a sharp rebound in US consumption more than offset weaker demand in Latin America.
· Asia’s demand extended its steady rise, climbing for a fifth straight month amid particularly strong growth in India.
· Sustained demand growth across the Americas and Asia cushioned the impact of still-subdued consumption in Europe.
· The global base oils surplus averaged monthly levels of less than 380,000 tonnes in the first eleven months of 2025, down from more than 550,000 tonnes in second-half 2024, pointing to persistently tighter market fundamentals throughout the year.
Market Repercussions
Rising global demand in recent months more than countered relatively rangebound base oils supply.
That balance could shift in the coming months as additional base oils production capacity ramps up or comes online.
Such a development would increase the importance of sustained consumption growth, especially in the US and Asia, to prevent a larger build-up of surplus volumes.
