· Global base oils prices hold firm vs feedstock/competing fuel prices even as they edge lower.· Firm base oils values point to tight supply-demand fundamentals, incentivize refiners to maintain high output.· Base oils values hold firm ahead of typical seasonal slowdown in demand in coming weeks in Asia, and from start of Q3 in Europe/US.· High base oils margins and prospect of seasonal slowdown in demand could trigger disconnect between supply and demand..· FOB Asia base oils values mostly hold firm, especially for heavy grades, even as they edge lower vs Singapore gasoil..· FOB Asia Group I SN 150 premium to gasoil stays well above year-earlier levels even as it slips from seven-month high in early-May 2025.· FOB NE Asia Group II N150 premium to gasoil falls more steeply than Group I SN 150 and increasingly lags year-earlier levels.· Dynamic points to weaker supply-demand fundamentals for Group II light grades than Group I light grades.· Even so, Group II premiums to gasoil remain at levels that continue to incentivize refiners to maintain or raise output..· China’s domestic Group II light/heavy-grade price premium to Shandong diesel prices stay unusually firm and well above year-earlier levels..· Firm domestic base oils premium incentivizes domestic refiners to maintain or raise base oils output.· Incentive to maintain or raise base oils output coincides with completion in May 2025 of round of plant maintenance work and precedes seasonal slowdown in demand..· CFR India Group II N70 premium to Singapore gasoil holds firm even as it edges lower..· N70 premium held at similar level the same time a year ago before slumping from end-May 2024.· Higher-than-usual premium points to sustained buying interest in India combined with balanced-to-tight supplies since early-March 2025.· Higher-than-usual premium keeps open the arbitrage to move more very-light grade supplies from Asia to India..· Europe’s Group I domestic base oils prices hold firm vs VGO even as they edge lower..· Group I light and heavy-neutrals premium holds at similar levels to same time a year earlier, while brightstock stays much higher.· Relatively steady Group I price premium contrasts with sharper fall in Group II/Group III price premium to VGO.· Dynamic could reflect tighter supply-demand fundamentals for Group I base oils compared with premium-grade base oils..· US Group II price premium to VGO falls, especially for domestic heavy grades..· Lower Group II price premium contrasts with rising price premium this time a year ago, especially for export prices.· Any extension of drop in price premium would point to diverging supply-demand fundamentals this year vs same time last year.· Even so, Group II price premiums remain at levels that incentivize refiners to maintain or increase base oils output..Asia base oils demand outlook: Week of 19 May.Asia base oils supply outlook: Week of 19 May
