· Global base oils prices mostly hold firm vs feedstock/competing fuel prices, especially in Europe and Asia.· Firm price differentials point to strong supply-demand fundamentals, incentivize refiners to supply more volumes for those markets.· Demand would need to hold firm to absorb any such pick-up in supplies.· Any slowdown in demand would speed up pick-up in surplus supplies..· FOB Asia base oils prices stay high versus Singapore gasoil prices..· FOB NE Asia Group II price-premium to gasoil holds firm in narrow range since around mid-April 2025.· Firm price-premiums point to strong supply-demand fundamentals.· Firm margins incentivize refiners to maintain high production levels.· Price premiums hold firm even after completion of most plant-maintenance work in Asia-Pacific region.· Price premiums hold firm even with demand set to face seasonal slowdown in coming weeks..· China’s domestic Group II N150 price premium to Shandong diesel prices extends fall to lowest in more than a month..· Falling price-premium mirrors similar trend the same time a year earlier.· Falling price-premium coincides with completion of key plant-maintenance work, precedes seasonal slowdown in demand.· Falling price-premium and weaker fundamentals could incentivize refiners to curb output..· CFR India Group II N70 price-premium to Singapore gasoil holds firm, at high end of range over past two years..· Firm premium over past three months points to persistently strong supply-demand fundamentals, even with completion of growing swathe of plant-maintenance in Asia and Middle East.· Firm premium points to strong demand even with typical seasonal slowdown in India’s lube consumption during monsoon season.· Firm premium keeps open the arbitrage to move more very-light-grade base oils to India.· Firm premium incentivizes Asia refiners to boost output of very-light grades and move more supplies to India..· Europe’s domestic Group III 4cSt (low) price premium to vacuum gasoil (VGO) extends rise to highest in almost seven months..· Rise in Group III 4cSt price-premium to VGO outpaces Group I and Group II base oils.· Rise in Group III 4cSt price-premium to VGO matches firmer Group III price premium in US market in May 2025.· Rising Group III 4cSt premium boosts incentive for refiners to raise output and move more supplies to Europe..· US Group III 4cSt premium to VGO rises to highest in more than eight months, contrasts with more rangebound Group II N100 premium to VGO since early-April 2025..· US Group III 4cSt premium still lags year-earlier levels, when premium continued to trend lower through H2 2024.· US Group II N100 premium to VGO is similar to year-earlier levels, when premium extended its rise through to end-Q3 2024.· Any divergence of those price trends over coming months could point to change in supply-demand fundamentals for Group II and Group III base oils..Asia base oils demand outlook: Week of 2 June.Asia base oils supply outlook: Week of 2 June.Base Oil News stories and analyses also available on the ICIS platform
