· Asia Group I heavy-neutrals price falls vs ex-tank UAE price since early-August to widest discount in more than two years..· Wider price-discount facilitates arbitrage to move surplus supplies from Asia to Middle East.· Asia’s surplus Group I supplies rise amid pick-up in imports from other regions like Europe, as well as recovery in output in markets like Thailand after plant-maintenance work.· Thailand’s surplus of Group I supply over demand rises to three-year high in Aug 2025, reflecting that dynamic..· Rapid adjustment in Asia’s Group I prices relative to other markets helps to remove surplus supply from the region.· Rapid adjustment in Asia’s Group I prices complicates arbitrage opportunities to clear any surplus Group I supplies from Europe.· FOB Europe Group I SN 500 price weakens vs CFR India price throughout most of Q3 2025, before strengthening from H2 Sept 2025..· Europe’s firmer Group I export prices relative to other regions in recent weeks could point to more balanced supply-demand fundamentals and easing pressure to clear any surplus.· Any such balanced fundamentals would contrast with signs of persistent surplus Group I supply throughout Q3 2025.· Rise in Group I supply at start of Q3 2025 precedes seasonal fall in demand over following weeks, reflecting that dynamic..· Europe’s firmer Group I export prices could alternatively reflect reluctance to offer supplies at price-levels required to be competitive vs shipments in other regions.· Any such reluctance to adjust export prices could help to maintain rangebound export-price-differentials vs Europe's domestic prices, limiting downward pressure on domestic prices..· Any such reluctance to adjust export prices would also limit arbitrage opportunities, leaving more surplus supplies lingering in Europe for longer.· Persistent surplus within Europe could still put more downward pressure on region’s domestic prices.· Europe’s domestic Group I prices weaken vs export prices in Sept 2025 amid pressure from persistent surplus in regional market..· Scenario suggests that sellers face choice of Group I export prices holding firmer vs other regions, with more manageable downward pressure on domestic prices.· Scenario would raise prospect of Group I base oils output holding firmer and market facing more persistent surplus supply.· Alternative choice is more competitive Group I export prices vs other regions that help to remove surplus supplies from Europe.· Scenario would raise prospect of more squeezed base oils margins and more pressure to adjust output accordingly..Global base oils margins outlook: Week of 13 October.UK’s July base oils output falls.Asia base oils supply outlook: Week of 13 October.Base Oil News stories and analysis also available on ICIS platform