· Asia’s heavy-grade base oils price-premium to Singapore gasoil stays elevated even as it edges lower.· Firm margins incentivize refiners to maintain high output of heavy-grade base oils.· Firm margins and high output could trigger rise in surplus supplies.· Sustained strength of base oils margins, and still-closed arbitrage to outlets like Americas, could instead point to more-balanced-than-usual supply for time of year.· More feasible arbitrage opportunities in markets like India and Middle East could also curb need to move shipments to Americas..· Asia’s light-grade base oils price-premium to Singapore gasoil falls to levels that could incentivize refiners to focus on producing more diesel instead.· Firm diesel premium to crude oil adds to attraction of boosting output of the motor fuel.· Any such moves to adjust output could depend on refiners’ leverage to adjust base oils prices to sustain firmer margins.· Any such leverage depends on strength of demand in overseas markets.· US Group II light-grade export price-premium to FOB Asia price narrows in H1 July 2025.· CFR UAE Group II light-grade premium to FOB Asia price holds in narrow range..· Lower or range-bound price-premiums point to lower or range-bound demand..· Taiwan’s base oils exports stay at elevated levels so far in July 2025, with most of the shipments continuing to move to southeast Asia and India.· Singapore’s base oils exports extend fall over last four weeks amid sharp dip in shipments originating from other markets..· Fall in shipments of re-exported supplies follows sustained slowdown in Singapore’s base oils imports since H1 April 2025..· Partial recovery in imports in recent weeks follows pick-up in arrival of shipments from US and Europe..· Any further rise in supplies from US and Europe could support revival in Singapore’s base oils exports..· South Korea’s base oils exports rise to four-month high in June 2025..· Higher exports follow completion of Group II plant-maintenance work earlier in Q2 2025.· South Korea’s exports could extend rise following completion of Group III plant-maintenance work at end-Q2 2025.· Higher output/exports in Q3 2025 raise prospect of faster build-up surplus supplies in Asia.· Lack of significant adjustment in FOB Asia cargo prices relative to markets like Americas increases possibility of such a scenario.· Lack of significant price-pressure could instead reflect regional demand that is sufficiently firm to absorb rise in supplies.· Firm imported cargo prices in markets like India raise prospect of such a scenario.· Such a scenario would leave supply more balanced, curbing need to line up arbitrage shipments to markets like Latin America..· India’s base oils imports from Asia hold steady in June 2025, contrasting with dip in shipments from Middle East..· Any extension of slowdown in shipments from Middle East to India would boost importance of flows from Asia holding steady-to-firm.· Such a scenario would help to absorb more supplies from Asia, curbing speed of build-up of any surplus volumes.· Such a scenario could also facilitate more arbitrage shipments from other major suppliers like US..S Korea’s June base oils exports rise.India’s June base oils imports fall.Asia base oils demand outlook: Week of 21 July.Asia base oils supply outlook: Week of 14 July
