Supply falls from August's 10-month high as imports, output dip
Balanced-to-tighter fundamentals heading into Q4 help offset seasonal slowdown
More balanced fundamentals help offset signs of rise in US flows to Europe in recent months
Europe’s Group II base oils supply fell in September as both regional output and imports declined, pulling total availability back from August’s ten-month high.
The pullback left the market with more balanced fundamentals heading into the fourth quarter, a period that typically brings a seasonal slowdown in demand.
Total Group II supply, or regional output and imports combined, dropped to around 145,000 tonnes in September, government data showed.
The slowdown reversed August’s sharp increase, when supply climbed above 180,000 tonnes during a seasonal lull in Europe’s lubricants demand.
September’s lower volume returned supply to more typical levels seen through most of 2025.
Supply fell because of a dip in imports to a five-month low, while regional output retreated from an eight-month high in August.
Excluding the Netherlands’ unusually high consumption, Europe’s September Group II supply fell even more sharply, hitting the lowest level in ten months.
Balanced-to-tighter fundamentals heading into the fourth quarter could help cushion the impact of a typical year-end slowdown in demand.
They could also leave the market better positioned to absorb signs of a pick-up in US shipments to Europe in September and October.
Europe’s higher Group II prices relative to other markets like the US boosted the incentive for such arbitrage shipments.
A seasonal slowdown in US demand, combined with a likely rise in Group II output from November following maintenance, added to the attraction of moving more supplies to Europe.
