Europe’s January Group I Exports Extend Fall Amid Tight Supply

Europe’s Group I base oils exports fell in January as tighter-than-usual availability at the start of the year left the market more exposed to the Middle East conflict that followed.

Total Group I exports to markets outside Europe fell to around 55,000 tonnes in January, down from more than 64,000 tonnes in December and 45% lower than year-earlier levels, Eurostat and HMRC data showed.

The year-on-year fall in exports was the fifth in six months as planned and unexpected plant shutdowns tightened regional supply late last year.

Lower supply cut the surplus volumes typically seen around the turn of the year, cushioning the impact of weaker demand.

The smaller surplus and subsequent drop in spot shipments to markets such as West Africa and India left those regions more exposed to the Middle East conflict.

Key Highlights

·         Exports fell year on year mostly because of a 72% drop in shipments from the UK.

·         Italy’s exports fell for the fourth time in five months even as monthly volumes rebounded to a one-year high after plant maintenance in late 2025.

·         Greece’s exports fell to a multi-year low after surplus volumes were cleared in October and November.

·         Group I exports fell more steeply than the 23% drop in total non-Europe exports, which dipped to a five-month low.

Market Repercussions

Tighter European supply around the turn of the year cut spot availability, prompting buyers in markets such as Nigeria to turn to the US to cover more of their requirements.

Stronger West African demand helped absorb surplus volumes from the US, where refiners continued to manage a seasonal overhang during the winter months.

Even those US shipments were likely to ebb as stronger domestic demand and Middle East-related supply disruptions left refiners prioritizing term commitments.

Tighter supply from Europe and the US, alongside rising prices, raised the prospect of a further squeeze on spot availability for export markets.