· Asia’s base oils price-premiums to gasoil recover amid lower crude oil prices.· Firmer margins, and signs of crude prices mostly holding in lower range, curb pressure on refiners to adjust base oils output.· Rise in Asia’s base oils supply coincides with more muted demand in China and southeast Asia and more complicated arbitrage to move heavy grades to India.· Rising supply and weaker regional demand boosts incentive/need to move shipments to more distant markets like Europe.· Taiwan’s base oils exports in Sept 2025 include another cargo bound for Europe.· Shipment would follow cargo that loaded from Taiwan in Aug 2025 before heading to Europe, with shipment arriving in early-Oct 2025.· Pick-up in shipments to Europe would follow persistently high Europe Group II base oil price-premium to FOB Asia cargo prices since late-Q2 2025..· Any extension of arbitrage flows from Asia to Europe would add supplies to a Group II market whose fundamentals remained balanced in Q3 2025.· Any extension of such flows could also coincide with prospect of slowdown in Group II shipments from Europe to Asia following recent start-up of new Group II unit in Singapore.· Arbitrage to move surplus supplies from Asia to Americas stays hard to work..· More limited arbitrage opportunities to other outlets could boost volume of shipments targeting Europe.· Singapore’s base oils exports show signs of reverting to more typical levels in Sept 2025 after slowdown in shipments in July-Aug 2025..· Re-exports of supplies originating from other markets fall as share of Singapore's total exports over last four weeks to lowest level since end-Q1 2025..· Waning requirements for supplies from other markets follows recent start-up of new Group II unit in Singapore.· Singapore’s base oils imports still surge in past week following arrival of unusually large shipment from UK.· Shipments adds to surge in Singapore’s Group I base oils imports over last four weeks..· Rise in Group I supplies adds to pick-up in regional availability of the supplies in recent weeks..· Prospect of rise in supply in Asia in Q4 2025 could curb impact of plant-maintenance work in Saudi Arabia during most of final two months of 2025.· Timing of rise in supply in Asia and plant-maintenance work in Middle East could instead provide opportunity for refiners in Asia to boost market share in markets like India and Middle East.· India’s base oils supply could be more balanced heading into start of Q4 2025 amid pick-up in imports in Sept 2025 and steady recovery in domestic output during Q3 2025.· India’s base oils output rises in Aug 2025 to highest this year, following completion of protracted round of plant-maintenance work..· Output faces prospect of extending rise later in Q4 2025, with new production capacity expected to start up following upcoming maintenance work..· Japan’s base oils output falls in Aug 2025 to lowest in more than fifteen years..· Size of fall in output outpaces typical drop in production during round of plant-maintenance.· Fall in output contrasts with rise in Japan’s total refined-products output in Aug 2025, including sustained jump in asphalt production.· Japan’s asphalt production exceeds base oils output in Aug 2025 for second month..· Strong rise in Japan’s asphalt output so far in 2025 and sustained slump in base oils output suggests country’s refiners are focusing on producing more asphalt instead of base oils.· Any such moves precede expected start-up of new base oils production capacity in Asia and Middle East in H2 2025 and early 2026.· Any such moves would trim slightly expected net rise in Asia’s base oils supply in coming months.· Any such moves would add to incentive for regional buyers to boost consumption of Group II base oils instead of Group I base oils..India’s August base oils supply lags demand.Japan’s August base oils output falls.Asia base oils demand outlook: Week of 6 October.Asia base oils supply outlook: Week of 29 September.Base Oil News stories and analysis also available on ICIS platform
