South Korea's base oils exports recovered in May from a 19-month low in April but remained the second-lowest in 16 months
Exports to Asia returned to near-normal levels even with recent maintenance work and feedstock disruptions
Exports could extend their recovery as maintenance ends and seasonal demand slows, increasing pressure on refiners to move surplus volumes into export markets
South Korea’s May base oils exports recovered from a nineteen-month low in April, with improving supply and weakening demand pointing to a further rise in shipments.
Total exports rose to 315,000 tonnes in May, up from 277,000 tonnes in April, Korea Customs Service data showed. The volume was still the second lowest in 16 months and below average monthly levels of 344,000 tonnes in 2025.
Asia's firmer share of total exports added to signs of relatively healthy availability of most base oils grades across the region despite plant maintenance work and supply and feedstock volatility in recent months.
The completion of maintenance work and sliding crude oil prices were now set to coincide with a seasonal slowdown in demand.
Key Highlights
· Exports to Asia rose to 140,000 tonnes, near the 2025 monthly average of 142,000 tonnes.
· Asia accounted for 44% of total exports, broadly unchanged from April but above the 2025 average of 41%.
· Exports to Southeast Asia rebounded to 67,200 tonnes from a 16-month low in April but remained below 2025 average monthly levels of more than 74,000 tonnes.
· Shipments to Japan remained close to April's 17-month high, while exports to China increased.
Market Repercussions
Exports could extend their rise in June following the completion of plant-maintenance work in first-half May and as high base oils margins incentivized refiners to maximise output.
A seasonal slowdown in demand in the coming months, alongside refiners’ concern about lower prices, could add to their impetus to maximise shipments rather than replenish low stocks.
Any such moves would likely impact Group II base oils more than Group III, which was less impacted by maintenance work.
The rise in shipments to Japan and China coincided with lower Group III availability from the Middle East, underscoring South Korea's growing role as the main alternative supply source for the premium-grade material.
Those exports were likely to continue until a recovery in supplies from the Middle East, which was unlikely in the near term even with a possible resumption of shipments through the Strait of Hormuz.
Improving Group II availability and still-tight Group III supply would extend a pattern since the end of the first quarter and sustain strong competition for the limited volumes of premium-grade base oils.