· India’s imported Group I heavy neutrals base oils cargo price strengthens relative to FOB Asia and Europe prices in July 2025..· India’s rising price-differential for Group I SN 500 follows drop in availability of the supplies from Iran especially in recent months..· India’s imports of Group I heavy neutrals fall to eighteen-month low in June 2025, mostly because of drop in supplies from Middle East..· India’s Group I imports from Thailand and Indonesia also pause in June 2025 for second month.· Pause in shipments precedes extended shutdown of key Group I base oils unit in Thailand during Q3 2025..· Tighter availability of Group I base oils in Asia and Middle East in early-Q3 2025 contrasts with prospect of rise in surplus Group I supplies in Europe.· Group I supply in Europe likely to get boost from combination of completion of plant-maintenance and seasonal slowdown in demand during summer months.· Rise in surplus volumes would contrast with Europe's tighter supply and lower Group I exports in H1 2025..· Tighter Group I supply and squeezed exports in H1 2025 keep shut the arbitrage from Europe to markets like Middle East and India..· Easing supply tightness in Q3 2025 could put pressure on arbitrage from Europe to open to clear any surplus volumes.· With its firmer demand and higher prices for Group I heavy neutrals, India could provide a useful outlet for any surplus volumes from Europe.· Even with India’s firmer Group I fundamentals in recent weeks, buyers could instead tap growing availability and increasingly competitive prices for Group II heavy grades to cover requirements..· Prospect of improving availability of Group I supplies from Middle East would provide additional options.· Dynamic puts onus on any surplus Group I cargoes from Europe to be lined up fast and to be at competitive price level to make arbitrage to India more feasible.· Any such moves to tap India’s firmer demand could help to clear any surplus supplies from Europe, leaving the region with more balanced fundamentals during final weeks of Q3 2025.· Need for FOB Europe Group I export cargo price to be at more competitive level could cut attraction of lining up any such shipments, especially if surplus is deemed to be manageable. · Any such resistance to more competitive price levels would provide opportunity for supplies from other sources to move to India.· Any such moves could then leave Europe with more surplus volumes to clear during final weeks of Q3 2025..India’s June Group I SN 500 imports fall.Global base oils margins outlook: Week of 28 July.Asia base oils demand outlook: Week of 28 July.Base Oil News stories and analyses also available on the ICIS platform
