· Global base oils prices hold firm versus feedstock/competing fuel prices.· Margins hold firm at time of year when fundamentals are typically weaker.· Firm margins incentivize refiners to maintain high base oils output.· Firm margins and high base oils output point to stronger-than-usual demand for time of year.· Firm margins and high base oils output need demand to be and to stay stronger than usual to avoid rapid rise in surplus supply..· FOB Asia price-premium to Singapore gasoil holds firm for Group I and Group II base oils..· Persistently-high price-premium suggests fundamentals remain balanced-to-firm so far during Q3 2025.· Group II heavy-grade price-premium holds in narrow range since end-June 2025.· Price-premium is lower than in Q2 2025 but stays at similar elevated levels to Q4 2024.· Elevated price-premium sustains incentive for refiners to maintain high heavy-grade output..· Group II light-grade price-premium holds close to highest since early-June 2025.· Firm price-premium adds to incentive for refiners to maintain high base oils output.· China’s domestic Group II light-grade price-premium to Shandong diesel prices extends rise to highest in more than three months..· Rise in price-premium points to firmer supply-demand fundamentals.· Price-premium rises through Aug 2025 at time of year when demand usually get boost from round of stock-replenishment before seasonal rise in lube consumption in late-Q3.· Rise in price-premium points to such a seasonal pick-up in demand..· CFR India Group II N70 price-premium to Singapore gasoil holds firm after strong rebound since mid-July 2025..· High price-premium incentivizes overseas refiners to produce more very-light grade base oils.· High price-premium keeps arbitrage open to move more of those supplies to India.· High price-premium, and prospect of more supplies bound for India, suggest that demand remains sufficiently strong to absorb additional volumes..· Europe’s Group II base oils price-premium to vacuum gasoil (VGO) stays high, holding at or above year-earlier levels..· Firm Group II price-premium contrasts with Group I light- and heavy-neutrals price-premium to VGO that is well below year-earlier levels.· Price-premium to VGO holds firm for Group I and Group II base oils, incentivizing refiners to maintain high output of both grades.· Even so, outperformance of Group II base oils margins versus Group I base oils points to increasingly firmer fundamentals for Group II supplies relative to Group I..· US Group II base oils price-premium to VGO stays in relatively range it has held in since late-2024..· Steady price-premium contrasts with volatility of margins in 2023 and H1 2024.· Price-premium remains relatively firm even if down from year-earlier levels.· Steady and firm price-premium points to relatively balanced fundamentals, incentivizing refiners to maintain steady-to-high base oils output..Asia base oils demand outlook: Week of 1 September.Asia base oils supply outlook: Week of 1 September
