Energy & Petroleum Products
Base Oils
Base oils are lubricant feedstocks traded by Group I, II, III and viscosity grade, with distinct regional supply-demand dynamics.
MARKET REFERENCES
How the market commonly references price
There is rarely one universal price for a physical commodity. Commercial value depends on the benchmark, specification, origin, destination, timing and logistics agreed between buyer and seller.
- ICIS FOB Asia / CFR Asia base-oil assessments
- Singapore ex-tank Group I references
- Middle East Group I / II / III assessments
TYPICAL COMMERCIAL STRUCTURE
How physical pricing is often built
Physical trades are generally negotiated as an outright $/mt price or as an assessed regional benchmark ± grade, origin and supply differential. Posted producer prices can also influence contract discussions.
PRICE DRIVERS
What moves the physical differential?
- Group and viscosity grade
- Viscosity index / sulphur
- Producer approvals
- Packaging or bulk basis
- Regional supply and turnaround schedules
PHYSICAL TRADE
Commercial considerations
FOB, CFR and ex-tank structures are common. Grade and approved-source requirements can be more important than a simple headline benchmark.
The examples on this page describe common market conventions at a high level. Actual contracts can use different pricing periods, assessments, quality adjustments, Incoterms and negotiated differentials.
Market methodology reference: view source / methodology
PHYSICAL COMMODITY BROKERAGE
Discuss a Base Oils requirement.
Share the specification, quantity, origin or destination, delivery basis and timing.