· Asia’s base oils prices hold relatively firm vs Singapore gasoil even as they edge lower.· Light-grade margins slip even amid signs of healthy regional demand..· Premium of ex-tank Singapore Group II N150 to FOB Asia cargo price also falls to lowest Q2 2024..· Premium falls as FOB Asia cargo price-gains outpace rise in ex-tank prices.· Signs of firm regional demand could limit room for further dip in light-grade base oil margins..· Even with margins edging down, regional prices hold at levels that sustain incentive for refiners to maintain or raise base oils output.· Firm base oils margins and steady base oils output add to signs that Asia market avoided large build-up of surplus volumes in July-August 2025.· More balanced supply curbs pressure on sellers to adjust prices to clear surplus volumes.· Balanced supply would still require firm demand to cushion prospect of higher output amid more limited round of plant-maintenance work over coming months.· Demand for Asia supplies in key outlets like India could also ease in face of increasingly attractive arbitrage opportunities from US, and even from Europe..· Rising output in China could also curb that country’s requirements for overseas supplies.· China’s base oils output rises to ten-month high in Aug 2025 as Group II output surges to highest since end-2021..· Firm base oils margins incentivize China’s refiners to keep output at more elevated levels.· Rising output in China could also trigger pick-up in exports, adding to supply in Asia-Pacific market..· Taiwan’s base oils exports show signs of staying high in Aug 2025, with trend extending into Sept 2025..· Asia’s Group I base oils supply likely to improve from low levels in July-Aug 2025.· Lower supply reflects plant-maintenance in Thailand combined with lower exports from Singapore, Japan, Iran and Saudi Arabia.· Asia’s exports from key Group I suppliers stay low in July 2025, reflecting that dynamic..· Thailand’s base oils output likely to extend recovery in September 2025 following completion of maintenance-work in mid-Aug 2025.· Maintenance-work triggers slump in Thailand’s base oils output in July 2025 to lowest since late-2022..· Sharp fall in Thailand’s lube demand, combined with surge in imports, cushions impact of drop in domestic output.· Thailand’s total supply duly exceeds demand in July 2025 for fourth time in five months..· Any pick-up in shipments from other suppliers in Asia and from Middle East would add to recovery in region’s Group I base oils supply.· Singapore’s base oils exports stay lower than usual over last four weeks..· Lower export volumes curb size of pick-up in additional Group I base oils supplies from Singapore.· Singapore sees pick-up in arrival of shipments in past week from key sources of Group I base oils, such as UK and Saudi Arabia.· Rise in shipments triggers recovery in Group I imports over past four weeks..· Exports from Saudi Arabia show signs of improving in Aug 2025 after falling to one-year low in July 2025.· Pick-up in shipments includes additional supplies that are expected to reach southeast Asia in coming week..· Surplus of base oils supply over demand in key global markets falls in Q2 2025 to lowest level since Q1 2023, and lowest level for three months of Q2 since 2019..· Global supply-surplus in H2 of each year outpaces surplus in H1 every year since 2021.· Supply-surplus could get further boost in H2 2025 amid expected start-up of new production capacity in southeast Asia and India in coming months.· Surplus could get additional boost if lube demand in key markets stays weak after consumption fell throughout most of H1 2025..China’s August base oils output rises.Thailand’s July base oils output falls.Asia base oils demand outlook: Week of 8 September.Asia base oils supply outlook: Week of 1 September.Base Oil News stories and analysis also available on ICIS platform
