Argus Base Oils

Argus Base Oils
Base oil market prices, news and analysis

Issue 15-02 Friday 16 January 2015
prices at a glance
Asia-Pacific
Group I
SN 150 ex-tank Singapore
Bright stock ex-tank Singapore
SN 150 fob Asia
SN 500 fob Asia
Bright stock fob Asia
Group II
N150 ex-tank Singapore
N150 fob Asia
N500 fob Asia
$/t
Low
High
715.00
705.00
1,060.00
570.00
545.00
970.00
745.00
735.00
1,090.00
605.00
585.00
1,010.00
-45.00
-40.00
-20.00
-40.00
-35.00
-25.00
690.00
695.00
550.00
560.00
720.00
720.00
595.00
600.00
-15.00
-12.50
-22.50
-20.00
Low
High
Northeast Asia
Group I
SN 150 cfr
SN 500 cfr
Bright stock cfr
Group II
N150 cfr
N500 cfr
$/t
600.00
595.00
1,050.00
640.00
635.00
1,100.00
-45.00
-45.00
-20.00
615.00
620.00
655.00
665.00
-40.00
-35.00
Low
High
India and UAE

Group I
SN 150 (LVI) cfr India
SN 500 (LVI) cfr India
Bright stock cfr India
SN 150 (LVI) cfr UAE
Group II
N150 cfr India
N500 cfr India
$/t
600.00
610.00
815.00
585.00
595.00
630.00
640.00
855.00
625.00
635.00
-25.00
-25.00
-45.00
-25.00
-25.00
610.00
625.00
640.00
655.00
-30.00
-30.00
47.67
473.00
-3.29
-6.75
Overview
Global base oil prices have fallen. Sellers in most markets have
cut their prices in a bid to keep pace with falling feedstock
prices. Markets where such moves have lagged the drop in
crude have seen a slowdown in demand, as buyers hold back
in anticipation of such a move. Buyers have anyway continued
to buy small volumes on a more regular basis, to minimise
their price exposure and take advantage of plentiful supplies.
Copyright 2015 Argus Media Ltd
$/t
Group I
SN 150 fob domestic NWE
Bright stock fob domestic NWE
SN 150 fob European export
Bright stock fob European export
Group II
N150 fca ARA
N600 fca ARA
Group III
4cst fca NWE
6cst fca NWE
8cst fca NWE
Low
High
690.00
725.00
880.00
580.00
635.00
710.00
730.00
755.00
910.00
610.00
675.00
750.00
-40.00
-40.00
-40.00
-25.00
-25.00
-40.00
805.00
860.00
830.00
890.00
-40.00
-40.00
991.00
1,003.00
985.00
1,072.00
1,078.00
1,061.00
-22.00
-22.00
-21.50
Low
High
490.00
500.00
500.00
540.00
520.00
530.00
530.00
570.00
-40.00
-40.00
-30.00
-30.00
Low
High
545.00
617.00
947.00
594.00
665.00
994.00
-30.50
-44.50
+0.00
533.00
537.00
561.00
583.00
586.00
609.00
-31.00
-27.00
-39.00
1,002.00
1,014.00
1,017.00
1,052.00
1,065.00
1,068.00
-38.00
-31.50
-31.50
729.00
780.00
779.00
807.00
776.00
827.00
825.00
853.00
-44.50
-17.00
-20.00
+0.00
Russia and FSU

Group I
SN 150 fob
SN 500 fob
SN 150 fob
SN 500 fob
Baltic Sea
Baltic Sea
Black Sea
Black Sea
$/t
US
Crude oil and gasoil futures

Ice Brent front month ($/bl)
Ice gasoil front month ($/t)
Europe
Group I
SN 150 fob
SN 500 fob
Bright stock fob
Group II
N100 fob
N220 fob
N600 fob
Group III (domestic)
4cst
6cst
8cst
Naphthenic base oils
Pale oil 60 fob
Pale oil 100 fob
Pale oil 500 fob
Pale oil 2000 fob
$/t
contents
Global trade flows, freight rates, feedstock fundamentals
Markets
News and analysis
Maintenance and market fundamentals
2-3
4-21
22-24
25-27
Argus Base Oils
Argus market map
$/t
fob Baltic Sea
fob European export

SN 150
595.00
SN 500
655.00
N150 fca ARA
817.50
N600 fca ARA
875.00
SN 150
505.00
SN 500
515.00
cfr NE Asia
SN 150
fob Black Sea
620.00
SN 500
615.00
SN 150
515.00
N150
635.00
SN 500
555.00
N500
642.50
cfr UAE (LVI)

fob US export
SN 150
569.50
SN 500
641.00
N100
558.00
N600
585.00
SN 150
605.00
SN 500
615.00
cfr India
Freight rates (US) *

Route
US Gulf coast-Rotterdam
US Gulf coast-Brazil
$/t
1,000t
3,000t
5,000t
10,000t
75-78
60.00
50.00
43-46
85.00
70.00
60.00
fob Asia
SN 150 (LVI)
615.00
SN 150
587.50
SN 500 (LVI)
625.00
SN 500
565.00
N150
625.00
N150
572.50
N500
640.00
N500
580.00
Arbitrage opportunities - Group I

Second centre less
first centre
$/t
SN 150
SN 500
This week Prior week
50.00
Europe export-Singapore
+135.00
+155.00
+65.00
+80.00
+225.00
+230.00
+205.00
+205.00
US Gulf coast-Far East
110.00
72-74
57.00
52.00
Baltic Sea-Singapore
US Gulf coast-India
135.00
100-105
85.00
75.00
Europe export-UAE (LVI)
+10.00
+10.00
-40.00
-40.00
Asia-US domestic
+67.00
+42.00
+144.00
+139.00
* rates for November 2014, provided by SPI Marine (www.spimarineusa.com)
Europe export-US domestic
Freight rates (Asia-Pacific) *

Route
$/t
3,000t
5,000t
Singapore-central China
49.00
43.00
Singapore-Indonesia
32.50
29.50
Singapore-Thailand
33.50
30.50
Singapore-WC India
46.50
42.50
Singapore-Japan
58.50
52.50
Japan-central China
36.50
31.50
Mideast Gulf-WC India
42.00
33.50
Black Sea-India (LVI)

Asia-India (LVI)
Baltic Sea-US domestic
+59.50
+49.50
+54.00
+59.00
+100.00
+95.00
+70.00
+65.00
+27.50
+12.50
+60.00
+50.00
+149.50
+124.50
+194.00
+184.00
Baltic Sea-domestic NWE
+205.00
+205.00
+225.00
+225.00
US export-Singapore
+160.50
+175.00
+79.00
+74.50
Arbitrage opportunities - Group II

Second centre less
first centre
$/t
N100/N150
N500/N600
Mideast Gulf-central China
72.00
66.50
Asia-ARA
+245.00
+262.50
+295.00
+315.00
South Korea-US Gulf coast
97.00
89.00
Asia-US domestic
+75.50
+59.00
+116.00
+105.00
South Korea-WC India
72.50
63.50
Asia-India
+52.50
+60.00
+60.00
+70.00
South Korea-Singapore
36.00
32.00
US export-ARA
+259.50
+268.50
+290.00
+291.00
South Korea-Japan
28.00
25.00
US export-India
26.00
US export-Singapore
South Korea-central China
30.00
South Korea-Taiwan
30.00
25.00
South Korea-Europe
144.00
127.00
* rates based on one port loading/one port discharge

* rates provided at market close on 15 January by SPI Marine
(www.spimarineasia.com)
Page 2 of 28
+67.00
+66.00
+55.00
+46.00
+147.00
+131.00
+122.50
+96.00
Argus Base Oils
Feedstock fundamentals
Global base oil prices are mixed relative to competing
and feedstock fuels. Margins remain unusually firm for the
time of year, as lower crude and diesel prices more than
outweigh slumping outright base oil prices.
European domestic SN 150 price premiums to 30-day
average Ice gasoil futures have fallen to $190/t. But the
premium remained much higher than levels around $105/t
the same time last year. The premium of SN 150 over fourweek average vacuum gasoil (VGO) has eased to $351/t.
But this price remained unusually high for the time of year.
US domestic N100 price premiums over 30-day average
US heating oil futures have risen to $0.28/USG. This
compared with around $0.17/USG the same time last
year. The premium to four-week average VGO has risen to
$0.68/USG, much higher than levels in the first half of last
year.
In Asia-Pacific, the premium of ex-tank Singapore
SN 150 over Ice gasoil held firm at around $207/t versus
around $160/t the same time last year. The premium of
ex-tank prices over four-week average high-sulphur fuel oil
prices has fallen to $436/t.
Prices have been slumping since the third quarter of
last year, mostly because of the sustained drop in crude
prices during the same time. The degree and length of the
price slide has complicated buying and selling strategies,
as all parties seek to minimise their exposure to the price
risk caused by the falling prices. Such concerns highlight
the lack of the kind of risk management tools that other
markets enjoy, which enable them to continue trading
activity.
But the sustained price slide has also helped to mask
the impact of the growing global supply overhang. The
price drop has supported producers margins as prices
struggle to keep pace with, rather than outpace, lower
crude. Firm margins have curbed any urgency to cut run
rates, limiting the size of any drop in supplies in recent
months.
The price drop has also complicated any moves to
work arbitrage opportunities. A persistent oversupply of
Group II base oils in US had originally targeted the Indian
market late last year as a key outlet. The overhang of
European bright stock had been offered into many markets
throughout Asia-Pacific in the fourth quarter. Asia-Pacific
Group II producers have been eyeing firm Group I and
Group II prices in Europe in recent months.
With no risk management tools, such arbitrage
opportunities have been hard to work without buyers
exposing themselves to the risk of market prices falling far
below the price level at which they bought the supplies

one to two months earlier. Several such trades took place
last year, prompting buyers to cut back requirements even
further as they sought to manage their subsequent losses.
A key requirement for such arbitrage opportunities
to be feasible in this market is stable prices for an
extended period. The price stability turns into its own
risk management tool. Many buyers and sellers are
subsequently keen for the slide in crude and base oil
prices to pause or come to an end.
But the persistent availability of the supplies for export
highlights the supply overhang waiting to be cleared.
The inability to work the arbitrage has prevented these
cargoes from moving to already well-supplied markets.
The more limited supplies have in turn reduced pressure
on prices and margins.
Steadier crude and base oil prices would reduce
concerns about exposure to price risk and would likely
aid such arbitrage flows. But a pick-up in such arbitrage
activity would boost competition and supplies for such
outlets.
With steadier crude, the price pressure on base oils
caused by falling crude values would ease. But the price
pressure caused by additional supplies from arbitrage flows
would rise. These would finally highlight the extent of the
supply overhang that the market faces.
US domestic base oils premium to VGO 2%

1.20
SN 150
$/USG
N100
1.00
0.80
0.60
0.40
0.20
0.00
17 Jan 14
Page 3 of 28
16 May 14
12 Sep 14
16 Jan 15
Argus Base Oils
Asia-Pacific
Asia-Pacific base oil prices have fallen, although the pace
of the drop lagged the sustained fall in feedstock prices
amid signs of steadier buying interest in the region.
A major regional producer is cutting its prices for the
second time this month, reflecting the impact of sliding
crude prices.
Buyers remain cautious. But this caution has prompted
many of them to operate with unusually low inventories,
at least until base oil prices stabilise. They are
subsequently replenishing stocks, with small volumes, on a
more regular basis.
Chinese buying interest begins to stir
Buying interest from China is also starting to stir. Buyers
in this market remain cautious but their stocks are also
low. Widespread plant run cuts in that country, combined
with maintenance in Taiwan and South Korea in March,
have also reduced some of the regional supply overhang of
Group II base oils.
But the scope for any price recovery will likely be
muted. Spot supplies remain readily available, while more
production capacity in southeast Asia is likely starting up
any time now. Some buyers also have the flexibility to
switch between Group I and Group II base oils, such that
any widening discount of either grade can trim demand for
the other grade.
Group I availability in the region is more balanced,
although demand is also increasingly limited.
Thailand offers February supplies
Thailand has sold most of its spot supplies for January and
has started offering February-loading supplies. A Japanese
producer has a smaller volume of spot supplies this month
compared with last month after it trimmed its operating
rates at the start of this month. It currently expects to
have no spot supplies available next month.
The Thai producer is offering as much as 6,000t of
February-loading supplies of mainly SN 500, as well as
bright stock and some SN 150. It was targeting the same
price levels for light- and heavy-neutrals as its January
prices. It was looking to offer bright stock at around
$1,000/t fob.
The producer has likely sold most of its January-loading
spot supplies of heavy-neutrals, although it possibly still
has surplus supplies of bright stock. A small shipment of
heavy-neutrals was likely sold last week to China. The
price for the shipment was deemed to be at a discount to
Group I
$/t
Low
High
715.00
745.00
-45.00
705.00
735.00
-40.00
1,060.00
1,090.00
-20.00
SN 150 fob Asia
570.00
605.00
-40.00
SN 500 fob Asia
545.00
585.00
-35.00
Bright stock fob Asia
970.00
1,010.00
-25.00
Low
High
Bright stock ex-tank Singapore
Group II
$/t
690.00
720.00
-15.00
695.00
720.00
-12.50
N150 fob Asia
550.00
595.00
-22.50
N500 fob Asia
560.00
600.00
-20.00
Ex-tank Singapore reference prices
$/t
Group I
Group II
SN 150
SN 600
Bright stock
N150
N500
815.00
820.00
1,175.00
730.00
740.00
Crude
$/bl
Dubai crude front month
44.79
-2.43
SN 500 premium to Dubai crude
34.84
-2.50
Oil products
$/bl
Singapore 0.05% gasoil
61.65
-2.70
Gasoil premium to Dubai crude
17.28
+0.40
SN 500 premium to gasoil
17.98
-2.23
Asia SN 500 forward prices
$/t
Low
High
Feb 2015
555.00
575.00
-46.10
Mar 2015
558.10
578.10
-46.00
Apr 2015
561.20
581.20
na
2Q 2015
565.30
585.30
-45.80
3Q 2015
580.15
600.15
The price shows the implied forward-curve base oil price required to
maintain its existing profit margin relative to Ice gasoil futures.
Refer to www.argusmedia.com for methodology
Asia SN 500 forward premium to gasoil
na
$/t
Midpoint
Feb 2015
48.90
-5.05
Mar 2015
45.80
-5.10
Apr 2015
42.65
na
2Q 2015
38.55
-5.35
3Q 2015
23.70
na
The premium shows the implied forward-curve profitability of fob Asia
SN 500 relative to Ice gasoil futures. Refer to www.argusmedia.com for
methodology
Page 4 of 28
Argus Base Oils
Asia-Pacific
market levels.
Another Thai producer has also been offering 2,000t of
SN 500 for January loading. It was unclear if the supplies
were sold this week.
A January-loading cargo of less than 2,000t of SN 500
and bright stock of Japanese origin was likely sold to a
buyer in southeast Asia. The price level for the SN 500 was
around the midpoint of last weeks Argus published prices.
The bright stock was sold at a discount to published price
levels.
No offers were seen for supplies from Indonesia, with
domestic prices remaining much higher than prices in
other markets.
The premium of Asia-Pacific bright stock prices to
European prices remained unusually wide. But falling AsiaPacific prices and more plentiful spot availability will likely
complicate any such moves to work this arbitrage. A vessel
was provisionally booked to load a cargo from Europe at
the end of January with the option to go to China.
The pick-up in Chinese buying interest extended to
Group II base oils. But buyers in this market remained
cautious, especially in anticipation of a large volume
of supplies from Taiwan expected to reach the country
around the end of this month. While export volumes from
Taiwan are firm for now, the islands Group II producer
is no longer offering any spot supplies as it readies for a
shutdown in March for maintenance.
A South Korean producer continued to receive
enquiries for light- and heavy-grade Group II base oil
supplies for delivery to southeast Asia.
Another producer was moving only term supplies to
buyers in southeast Asia this month. It faced no pressure
from inventories, after firm spot sales to India and China in
January. It was maintaining its operating rates at 80pc but
will consider raising its run rates if demand picks up.
Vessel enquiries: Asia-Pacific

Next port
B/L Date
Volume
Yosu
Nantong
16-29 Jan
2,000
Portugal
India/China
End-Jan-ely Feb 4,000
Daesan
Mumbai
25-31 Jan
3,000-4,000
Malacca
Antwerp
10-20 Feb
6,200
Source: shipping agents, brokers
the expense of other ex-tank sellers. The attraction of

such supplies will increase further following another price
cut that will come into effect next week. The supplier is
cutting its Group I prices by $40/t and its Group II prices
by $30/t, effective 21 January.
Buying interest for its supplies extended to Malaysia,
with prices increasingly attractive even with the extra
trucking costs to supply this market.
Availability of Group III supplies was more plentiful.
Offers of spot supplies were around $995-1,005/t ex-tank
southeast Asia.
Fob Asia Group I vs Group II

100
N150 vs SN 150
$/t
N500 vs SN 500
50
0
-50
-100
10 Jan 14
Sellers cut ex-tank prices

Buyers caution, combined with the need to hold sufficient
stocks to sustain operations, has boosted activity in the
ex-tank market. But requirements were for small volumes,
with buyers replenishing stocks more frequently.
A Singapore-based trading firm was targeting price
levels around $720/t ex-tank Singapore for N150 and N500.
The prices were some $70/t lower than its previous levels.
It offered Group III 2cst at $1,075/t ex-tank and 4cst and
6cst at $1,145/t.
Competitively priced Group II supplies from a major
supplier were also boosting interest in these volumes at
Loading port
Page 5 of 28
9 May 14
5 Sep 14
9 Jan 15
Webinar
Base Oils Market Falling Prices - Wheres the bottom?
Base Oils Analyst Alvin Chew and Base Oils Reporter Joyce De Thouars
discuss the recent fall in base oil prices, and whether prices have
bottomed out.
Click here to listen or visit www.argusmedia.com/News/Webinarsand-Presentations/2014/Base-Oils-Market-Falling-Prices for more
information.
Market Reporting
Consulting
illuminating the markets
Events
Argus Base Oils
Northeast Asia
Northeast Asian base oil prices have weakened further
on the back of falling crude prices and cautious buying
activity.
But market signals were more mixed. Trading firms
and downstream users have maintained their inventories
at low levels for a prolonged period as they secured small
volumes on a need-to only basis. But that has left them at
risk to any short-term supply tightness.
Consumption tax rises again
Producers have tightened availability in response to the
oversupply and weak demand. The Chinese government
also raised by about 135 yuan/t ($22/t) the consumption
tax for base oils and lube products. The tax increase is the
third in less than two months.
The combination of tighter availability and the increase
in costs because of the tax rise has provided some price
support.
But many market participants remained cautious
because of the sustained downwards pressure caused by
sliding crude prices. Uncertainty about the possibility of
another increase in the consumption tax also added to a
reluctance to commit to taking large volumes.
There was a pick-up in enquiries for cargoes as some
buyers started to prepare to restock ahead of the spring
oil-change season. But purchases were still made on a
need-to basis for now amid expectations that prices have
yet to bottom out.
Group I prices in Chinas domestic market extended
their fall amid scarce buying interest. Refineries kept
operations at low rates, with the benefit of lower
feedstock prices eroded by the higher consumption tax.
Producer cuts prices
Sinopec pegged its Group I prices at Yn7,100/t ($1,145/t)
ex-refinery for light and heavy grades from its Gaoqiao,
Yanshan and Maoming plants. Prices were some Yn200/t
lower than last week.
Supplies of SN 150 and SN 400 from PetroChinas Dalian
refinery were offered at Yn6,800-6,850/t ex-refinery.
Prices of SN 200 and SN 400 from its Daqing and Fushun
refineries stood at Yn6,800/t ex-refinery. While demand
was weak, the major producer was reluctant to cut its
price offers as the move would do little to spur sales.
Bright stock prices slipped as lower offers failed to
attract any firm buying interest. Price offers for bright
stock of southeast Asian origin eased to Yn10,500-10,600/t
ex-tank in east China.
Buyers showed no interest in offers at $1,100/t cfr or
Group I
$/t
Low
High
SN 150 cfr
600.00
640.00
-45.00
SN 500 cfr
595.00
635.00
-45.00
1,050.00
1,100.00
-20.00
Low
High
Bright stock cfr
Group II
$/t
N150 cfr
615.00
655.00
-40.00
N500 cfr
620.00
665.00
-35.00
Low
High
4cst cfr
970.00
1,000.00
-5.00
6cst cfr
975.00
1,000.00
-5.00
8cst cfr
920.00
950.00
-5.00
Group III
$/t
China domestic prices

Yn/t
$/t
Low
High
Low
High
Daqing
6,800.00
Dalian
6,800.00
6,900.00
+0.00 1,099.00
1,115.00
+5.00
6,900.00
+0.00 1,099.00
1,115.00
+5.00
7,000.00
7,300.00 -200.00 1,131.00
1,180.00 -27.50
7,000.00
7,300.00 -200.00 1,131.00
1,180.00 -27.50
Group I, SN 150
Northeast
North
Yanshan
South
Maoming
Group I, SN 400
Northeast
Fushun
6,800.00
6,900.00
+0.00 1,099.00
1,115.00
+5.00
Dalian
6,850.00
7,000.00
+0.00 1,107.00
1,131.00
+5.00
7,000.00
7,300.00 -200.00 1,131.00
1,180.00 -27.50
7,300.00
7,500.00 -200.00 1,180.00
1,212.00 -27.00
7,000.00
7,200.00 -100.00 1,131.00
1,164.00 -11.00
South
Maoming
Group II, N150
East
Gaoqiao
South
Huizhou
China import price calculator *

Yn/t
Low
$/t
High
Low
High
Group I (imported prices)

SN 150
6,607.00
6,914.00
+317.50
1,068.00
1,117.00 +56.00
SN 500
6,568.00
6,875.00
+317.00
1,061.00
1,111.00 +55.50
10,060.00 10,444.00
+494.50
1,626.00
1,688.00 +87.00
Bright stock
Group II (imported prices)

N150
6,722.00
7,029.00
+355.50
1,086.00
1,136.00 +62.00
N500
6,760.00
7,105.00
+393.50
1,093.00
1,148.00 +68.50
* inc. 6% customs duty, 17% VAT and 1,711.50 Yuan/t consumption tax.
Page 6 of 28
Argus Base Oils
Northeast Asia
lower for bright stock from southeast Asian suppliers.
The increase in the consumption tax dampened further
the attraction of such offers. Buyers had already been
expecting further price-cuts following the slump in crude
prices.
A small volume of SN 500 of Thai origin was possibly
bought at a low $600/t cfr level. Some Chinese trading
firms were possibly seeking to replenish stocks at prices
deemed to be attractive compared with domestic prices
being offered at relatively higher levels. But the purchase
was made before the increase in the consumption tax.
Importers nurse losses
Activity remained subdued in the market for Group I
base oils from Russia. Price offers for all four grades
were posted at around Yn6,000/t ex-tank Beijing, or the
equivalent of around $485/t daf Erlian. Inventories were
running low amid muted trading activity. But loss-making
deals in the fourth quarter of last year made trading firms
increasingly cautious.
The results of Rosnefts most recent tender to sell
supplies from its Angarsk refinery had yet to be released.
Chinese importers will only accept prices at around the
$300/t cpt Naushki level. Such a level reflected their
uncertainty about any further drop in crude prices and
the possibility of a further increase in Chinas consumption
tax.
Sluggish demand also dampened buying interest in
the supplies. With deals from the tender unlikely to have
been concluded, Rosneft issued a new tender this week.
It offered a total of 1,440t of base oils from its Angarsk
refinery, for delivery in the last week of January.
Cargo prices fall, ex-tank prices firmer
Group II base oil prices extended their fall. The tax
increase and tighter availability of supplies for immediate
delivery provided some support for ex-tank prices in
China. But with the absence of any pick-up in demand,
prices were expected to slide when availability improves
again.
CNOOC cut the posted prices for supplies from its
Huizhou refinery. It offered N60 at Yn6,950/t ex-tank in
east China and N150 at Yn7,200/t.
Sinopec also cut by Yn200/t its prices for Group II spot
supplies from its Gaoqiao plant to Yn7,400/t ex-refinery.
Shandong Qisheng Industrial and Trade kept its prices
steady. It offered supplies of N60 at Yn6,600/t and N150 at
Yn6,950/t ex-refinery.
Panjin Northern Asphalt also maintained its price
offers, with supplies of light- and heavy-grade base
oils offered at Yn6,800/t and Yn7,100/t ex-refinery
respectively.
Hainan Handi cut its plants operating rates, leaving it
with no spot supplies of N150 or N500.
Spot supplies of N150 and N500 of Taiwan origin were
offered at Yn7,300/t and Yn7,500/t ex-tank respectively
in east China. The Taiwan producer has a plant shutdown
scheduled in March for maintenance. But its exports to
China this month have held firm.
Heavy-grade supplies of South Korean origin were likely
offered at Yn7,500/t ex-tank in east China.
A large blender bought a 3,000t cargo of light- and
heavy-grade supplies of South Korean origin to meet
formulation requirements for the lubricants.
Buyer considers tender to secure supplies
Group III prices were stable to soft amid general market
weakness. An 8,000t shipment of Group III supplies from
Mideast Gulf likely reached China recently. Some Chinese
buyers also planned to issue tenders in 2015 for purchasing
this premium-grade base oils.
Chinas wholesale diesel prices dipped again, to
Yn5,600/t in east China and Yn5,550/t in south China. The
countrys main economic planning agency, the NDRC, cut
its ceiling prices for diesel by another Yn230/t during the
week.
South Korean exports to China / Chinese imports 000 t

350
South Korean exports to China
Chinese imports
300
250
200
150
100
50
0
May 13
Page 7 of 28
Nov 13
May 14
Nov 14
Argus Base Oils
India
Indian base oil prices have fallen further, amid persistently
weak buying interest because of concern that prices will
continue to drop again.
With no way to cover their price exposure to a
further drop in prices, buyers are minimising inventories
and buying smaller volumes on a more regular basis to
maintain their lube plant operations.
Lube demand rises
Finished lubricating oil demand typically rises around this
time of year. Some blenders have seen such a pick-up in
demand in recent weeks. Some of them have introduced
more promotions and special discounts to spur sales. But
the largest blenders have yet to cut their finished lube
prices, despite the slump in base oil prices.
To reduce their exposure to lower prices, buyers are
targeting supplies that typically involve a voyage time
of around 20-25 days. This is instead of some supplies,
such as from the US, that usually take more than 40 days.
The risk of delays to the shipment of supplies from the
US can extend the voyage time even further, adding to a
reluctance to secure cargoes from this market.
But offers of US supplies are at significant discounts to
supplies from Asia-Pacific. Such discounts help to cover
some of the exposure to the possibility of a further drop
in prices and continue to attract some interest. Even
with such exposure, supplies from the US have continued
to move to India, with deliveries this month already
exceeding total import volumes in December.
Buyers lean on South Korea for supplies
But the focus on inventory management has prompted
buyers to cover more of their requirements through term
Indian base oils vs Europe
140
SN 150
$/t
Bright stock
Group I
Low
645.00
675.00
-35.00
660.00
690.00
-35.00
SN 150 (LVI) cfr
600.00
630.00
-25.00
SN 500 (LVI) cfr
610.00
640.00
-25.00
Bright stock cfr
815.00
855.00
-45.00
Low
High
Group II
$/t
N150 cfr
610.00
640.00
-30.00
N500 cfr
625.00
655.00
-30.00
Low
High
Group III
$/t
4cst cfr
825.00
860.00
-10.00
6cst cfr
835.00
870.00
-10.00
8cst cfr
760.00
800.00
-10.00
Domestic refinery prices

Rs/l *
$/t
SN 70
68.35
+0.00
1,351.00
+13.00
SN 150
64.45
+0.00
1,197.00
+12.00
SN 500
63.95
+0.00
1,168.00
+11.00
Bright stock
94.00
+0.00
1,683.00
+17.00
SN 70
66.35
+0.00
1,312.00
+13.00
SN 150
62.45
+0.00
1,160.00
+12.00
SN 500
59.45
+0.00
1,086.00
+11.00
Bright stock
92.45
+0.00
1,655.00
+17.00
N70
66.71
+0.00
1,285.00
+12.00
N150
65.25
+0.00
1,239.00
+12.00
N500
64.71
+0.00
1,214.00
+13.00
N70
70.65
+0.00
1,361.00
+13.00
N150
63.25
+0.00
1,201.00
+12.00
N500
60.65
+0.00
1,137.00
+11.00
Group I
IOC prices, Chennai
IOC prices, Mumbai
100
IOC prices, Chennai
IOC prices, Mumbai
40
20
17 Jan 14
SN 500 cfr
Group II
60
High
SN 150 cfr
120
80
$/t
16 May 14
* India midpoint price vs Europe high price
12 Sep 14
16 Jan 15
* prices in Rs/l effective from 01 Jan
Page 8 of 28
Argus Base Oils
India
contracts, mostly from South Korea. But price offers from

South Korean producers have fallen less than for supplies
from other Group I and Group II suppliers. The sustained
wave of price cuts in response to competing offers from
other suppliers seen late last year has also ebbed.
A producer has likely completed its spot sales for
January-loading supplies. Its price levels were relatively
firm compared with competing suppliers. More than half
the volume was light-grade supplies. Its inventories are
now quite balanced. It plans to start discussing supplies
for February loading from next week.
Another producer completed its spot sales to Indian
buyers last week. It sold as much as 7,000t of Group II
supplies, at prices some $40-50/t below December price
levels. It is targeting sales of a similar volume in February.
There has been a slowdown in offers in recent weeks
from another producer, which trimmed its operating rates
in second-half December.
Some producers expected demand to get a boost
next month, ahead of the shutdowns in March of
Formosa Petrochemicals Group II plant in Taiwan and SK
Lubricants total base oils production capacity in South
Korea.
The shutdowns could boost demand for light-grade
supplies especially, also increasing demand in China for
such supplies as buyers there also seek to cover their
requirements. But the availability of such supplies from
Spain could cap the impact in India of the shutdown in
South Korea.
US discounts sustain buyers interest
Cargoes of US origin remained available at discounts to
supplies from South Korea. But the earliest delivery time
for such supplies was unlikely to be before March. Supplies
had been offered by several trading firms. Offer levels
had been around the $630-640/t cfr level last week. But
offer levels were possibly now being revised following the
latest slide in crude prices. Buyers were targeting prices
at levels much lower than $600/t cfr.
Group I base oil supplies were also available, with offer
levels falling faster than some Group II offers. But buying
interest was lukewarm.
A small cargo of bright stock of European origin
attracted some buying interest and was subsequently
sold. But supplies from other sources were also possibly
available.
Vessel enquiries: India
Loading port
Next port
B/L Date
Volume
Portugal
India/China
Jan-ely Feb
4,000
Daesan
Mumbai
25-31 Jan
3,000-4,000
Rayong
Chittagong
31 Jan-1 Feb
3,000
Supplies of light- and heavy-neutrals from Europe were

also possibly being offered.
There was an enquiry for a vessel to load as much as
4,000t of base oils from Portugal at the end of January to
take to India.
Supplies from Russia were possibly also available, with
price levels around $620-630/t cfr. Buyers were targeting
prices lower than $600/t for such supplies. There was less
interest in supplies from Iran.
Producer offers more supplies
A domestic producer in India offered more Group I supplies
for export. It offered through a tender as much as 5,000t
of mostly SN 500 and some SN 150 for 20 January-20
February loading. The tender closed on 14 January.
It offered last week as much as 15,000t of SN 500
for loading in three shipments in January, February and
March. This tender closed on 7 January.
Group III base oil prices continued to lag the drop in
Group I and Group II prices. The firmer price levels have
dampened spot demand for the supplies, despite signs of
steadier shipment volumes from Bahrain. The premium of
4cst base oils over Group II N150 widened to more than
$210/t. Supplies of 6cst base oils were tight.
Chinese / Indian base oil imports

300
China
000 t
India
250
200
150
100
Nov 11
Page 9 of 28
Nov 12
Nov 13
Nov 14
Argus Base Oils
Mideast Gulf
Mideast Gulf base oil prices have fallen, as buyers await
updated offers in response to the latest drop in crude
prices.
The pace of the price slide has left a wide range of
price indications in the market. Some sellers are offering
at levels that have been revised following the latest fall
in feedstock prices. Other offers were unchanged from
earlier levels. Other offers were withdrawn, with sellers in
the process of revising their price levels.
There is some buying interest, reflecting a combination
of firmer demand and many lube blenders holding low
stocks. They must consequently buy more frequently to
top up their inventories. But the preference is still to hold
off as long as possible until prices show signs of stabilising.
Buyers await lower offers
There was plentiful availability of supplies from Iran.
Price indications were in a wide range, likely reflecting
the impact of the speed of the drop in crude prices. Some
offers were possibly still around the $620-640/t fob Iran
level. But other offers were pegged at much lower levels
below $600/t fob.
A large shipment of base oils from the Black Sea is
likely bound for the UAE market. Offers of supplies of
Russian base oils were seen. But again the range of such
price offers was unusually wide. Most such offer levels
were at similar levels to Iranian base oil offers on a cfr
UAE basis.
Supplies of on-specification Group I base oils from
Europe were also possibly available at competitive levels
compared with supplies from the Black Sea market.
A cargo of bright stock was also available. But buying
interest in the supplies was limited.
Group II sellers revise offers
Buyers were awaiting an update of price offers for Group II
supplies from the US. Offers had been around $630-640/t
cfr. But buyers are now targeting lower levels than this. A
shipment in the US is scheduled to complete loading this
week before heading for UAE and India. More such supplies
were being offered for loading from US at the end of
January or early February.
Group II supplies have also been available from AsiaPacific. But one producer now only has a small volume of
supplies remaining for this month, after recently selling a
4,000t cargo to a buyer in the region. Another producer
is also eyeing other regions instead of the UAE because
Group I
$/t
Low
High
SN 150 cfr UAE
625.00
665.00
-50.00
SN 500 cfr UAE
640.00
680.00
-50.00
585.00
625.00
-25.00
595.00
635.00
-25.00
Low
High
4cst ex-tank UAE
1,055.00
1,085.00
-5.00
6cst ex-tank UAE
1,060.00
1,090.00
-5.00
8cst ex-tank UAE
1,060.00
1,090.00
-5.00
Group III
$/t
Iran export prices
$/t
Sepahan Oil *
SN 500 fob
690.00
0.00
Rubber process oil fob
400.00
0.00
Slack wax fob
700.00
0.00
* prices on a fob Bushehr basis, effective from 26 December - 08 January
of more attractive price levels elsewhere. It was in

discussions over a 3,500t cargo for late January or early
February loading. But no deal has yet been completed.
Ex-tank prices hold steadier
Ex-tank base oil prices were steadier. Buyers focus on
minimising stocks was sustaining demand for such smallvolume supplies. The limited number of sellers also gave
them more leverage to support prices, especially as they
sought to minimise any downwards price move below
levels that they had bought at.
Offers of SN 500 were around $720-740/t ex-tank, with
SN 150 some $15-20/t lower than this. Offers of Group II
N500 were in a wide $830-880/t range, although there
were no longer any offers above the $900/t level. Offers of
N150 were around $820-840/t ex-tank.
Group III base oil prices were relatively steady. A large
volume of supplies has been exported out of the region in
recent weeks, leaving regional availability tighter. A wide
premium of ex-tank prices over cfr UAE prices has spurred
some buyers to seek cargo volume supplies instead.
Shell said it opened a storage hub in Jebel Ali to
receive gas-to-liquids (GTL) base oil shipments from its
joint-venture plant in Qatar. The first delivery of GTL base
oil supplies reached Jebel Ali in December. Its other key
storage hubs are in Houston, Hamburg and Hong Kong.
Page 10 of 28
Argus Base Oils
Europe
European base oil prices have extended their fall, with
demand failing to revive at the start of the new year amid
persistent concern about volatile feedstock prices.
With feedstock prices extending their fall, and demand
weak, a major supplier in the region cut its prices for a
second time this month.
Activity in the export market continued to be
hampered by buyers subdued demand for large cargoes.
But there were signs of a firmer demand for bright stock
in some markets like India and Egypt. Sellers are eyeing
moving more supplies to Turkey and west Africa. But
such shipments face growing competition from more
competitively priced supplies from Russia.
Regional blenders held off from buying large volumes
as they sought to manage their inventories carefully in
anticipation of a further drop in prices. They are waiting
for crude prices to stabilise as a first signal towards more
stable base oil prices. They have sufficient supplies in
stock for now to be able to postpone any buying until next
month.
Producer cuts prices again
Refiners continued to offer discounts to published prices
for light grades. But the offers attracted little buying
interest. A major supplier likely cut its prices for SN 150 by
$40/t, SN 600 by $50/t and bright stock by $20/t. The cut
was its second this month, following two such price cuts in
December.
Base oil margins have held unusually firm even with
the lower prices. Base oils premium to vacuum gasoil
is already at levels that are reached around the month
of May, during the peak of the spring oil-change season.
Such levels have fed buyers expectations of further price
cuts. They have also encouraged refiners to sustain strong
production rates. But with the market unable to absorb all
of these volumes, oversupply rather than weak margins are
starting to spur some run cuts.
The market has been anticipating since last year
the likely closure of several Group I base oil plants. The
prolonged expectations will likely dampen the impact
of any such closures by giving buyers time to switch to
suppliers that are less likely to face such an outcome.
Plant strike affects output
While the anticipated closures are taking place more
slowly than expected, they are still causing some
temporary disruption to market activity. Base oils
production and loadings at one northwest European plant
Group I
$/t
Low
High
690.00
730.00
-40.00
725.00
755.00
-40.00
Bright stock fob domestic NWE
880.00
910.00
-40.00
580.00
610.00
-25.00
635.00
675.00
-25.00
Bright stock fob European export
710.00
750.00
-40.00
Group II
/t
$/t
Low
High
Low
High
N150 fca ARA
695.00
716.00
-21.00
805.00
830.00
-40.00
N600 fca ARA
742.00
768.00
-20.00
860.00
890.00
-40.00
Low
High
Low
High
4cst fca NWE
855.00
925.00
-2.50
991.00 1,072.00
-22.00
6cst fca NWE
865.00
930.00
-2.50 1,003.00 1,078.00
-22.00
8cst fca NWE
850.00
915.00
-2.50
-21.50
Group III
/t
$/t
985.00 1,061.00
Turkey Group I
$/t
Low
High
SN 150 cfr Gebze
560.00
590.00
-50.00
SN 500 cfr Gebze
585.00
615.00
-50.00
Crude
$/bl
North Sea Dated
47.53
-1.72
SN 500 premium to North Sea Dated
44.79
-1.80
Oil products
Heating oil 0.1% barge ($/t)
462.00
-17.50
Vacuum gasoil 0.5% barge ($/t)
350.50
-1.50
Vacuum gasoil 1.6% barge ($/t)
334.25
-5.00
Fuel oil 3.5% barge ($/t)
236.25
-9.25
Straight run M-100 fuel oil cargo ($/t)
244.75
-9.25
Heating oil premium to crude ($/bl)
14.54
-0.63
Heating oil premium to VGO 1.6% ($/bl)
12.91
-1.62
SN 500 premium to heating oil ($/bl)
30.25
-1.17
SN 500 premium to VGO 1.6% ($/bl)
43.16
-2.79
Oil products premiums
Page 11 of 28
Argus Base Oils
Europe
have been affected by the latest strike action at the
plant. The strike is in protest against likely job losses
resulting from the planned discontinuation of its base oils
production. The refinery plans to continue production at
least until March to fulfil its contracts.
Group II base oil prices have maintained their wide
premium to Group I prices. The price dynamic contrasts
with every other major market.
Some buyers are increasing their consumption of the
higher quality base oils. Others are waiting for the Group
II price premium to Group I prices to narrow and for more
choice of supplier. Such a situation should materialise,
with various sellers looking at moving Group II supplies
into Europe. ExxonMobils plants in Baytown, Texas and
Singapore are expected to complete the expansion of their
Group II base oils capacity any time now.
Euro weakness supports Group III price
Group III base oil prices have held relatively steady in euro
terms but fallen in US dollar terms. But the fall in prices
continued to lag Group I prices and the fall in Group III
prices in other markets like US.
Preparations for maintenance at plants in Europe and
South Korea are providing some price support. But the
impact of the South Korean plant shutdown will be limited
by the availability of supplies from a Group III plant in
Spain that started operations last September. Imports
from South Korea have already fallen sharply since then.
A large volume of supplies from Bahrain has also been
moving to Europe in recent weeks.
Besides existing suppliers, Russias Tatneft is eyeing
the European market with supplies from its 186,000 t/yr
Group II/III plant. The new plant began operations in early
December. Adnocs Group III plant in the UAE is expected
to start operations around March or April, with its supplies
also likely to target Europe.
Activity in the export market has started to revive.
Some trading firms were seeking to move bright stock
to the US, Mideast Gulf and Asia-Pacific. A small cargo
of European bright stock was sold into India. Egypt also
sought through a tender 2,500t of bright stock. The
request attracted the attention of many sellers, reflecting
the otherwise limited regional buying interest. The tender
has closed and is expected to be awarded next week.
Many refiners likely continued to offer supplies at
discounts to published prices, although some of them
offered within the published prices range. Some deals
were done at discounts to published levels.
There were several enquiries for vessels later this
European forward premium to gasoil
$/t
SN 150
SN 500
Midpoint
Midpoint
Feb 2015
78.90
+4.95
138.90
+4.95
Mar 2015
75.80
+4.90
135.80
+4.90
Apr 2015
72.65
na
132.65
na
2Q 2015
68.55
+4.65
128.55
+4.65
3Q 2015
53.70
na
113.70
na
The premium shows the implied forward-curve profitability of fob Europe
SN 150 and SN 500 relative to Ice gasoil futures.
European forward prices
$/t
SN 150
SN 500
Low
High
+/-
Low
High
Feb 2015
585.00
605.00
-36.10
645.00
665.00
-36.10
Mar 2015
588.10
608.10
-36.00
648.10
668.10
-36.00
Apr 2015
591.20
611.20
na
651.20
671.20
na
2Q 2015
595.30
615.30
-35.80
655.30
675.30
-35.80
3Q 2015
610.15
630.15
na
670.15
690.15
maintain its existing profit margin relative to Ice gasoil futures.
Vessel enquiries: Europe
na
Loading port
Next port
B/L Date
Volume
Augusta
Vado
22-24 Jan
8,500
Livorno
Marmara
19-25 Jan
800
Leixoes
Aqaba
20 Jan-10 Feb
3,000
Augusta/Livorno
Greece
Prompt
2,000
Livorno
Haifa
18-22 Jan
2,000
Algeciras/ Lexioes
Port Sudan
19-25 Jan
2,000
Baltic, Antwerp
WAF
31 Jan-1 Feb
6,000-8,000
PJG, Le Hav, Hbrg
Sweden/Finland
21-23 Jan
4,460
Livorno / Antwerp
Brazil
18-31 Jan
9,500
Rdam
Gebze
14-18 Jan
2,500
Rdam
Durban
Prompt
1,500
Malacca
Antwerp
10-20 Feb
6,200
month to take supplies from northwest Europe and the

Mediterranean market to Turkey. But competition to
supply that market has intensified, amid lower priced
offers from the Black Sea market. European export prices
moved to a premium to Turkish import prices for the first
time since last May.
There was also some buying interest from west Africa,
although that market is also becoming a target for Group
II base oils. There was an enquiry for a vessel to load as
much as 8,000t of base oils from the Baltic and northwest
European markets at the end of January to take to west
Africa. There was also an enquiry for a vessel to load
as much as 9,500t from the Mediterranean market and
northwest Europe in second-half January to take to Brazil.
Page 12 of 28
Argus Base Oils
Europe
Turkey
Freight rates to Gebze, Turkey
Turkish base oil prices have extended their fall, amid still
weak buying interest and lower offers from the Black Sea
market.
Buyers remained reluctant to commit to large
shipments until prices have stabilised. They are instead
continuing to buy smaller volumes to cover their minimum
requirements. But some of them are likely facing tighter
supplies, after several months of falling imports. There
were signs of a pick-up in enquiries from some buyers,
although these have failed to translate into deals.
Supplies of SN 150 of Russian origin were available
at around $570-580/t cfr Gebze, with SN 500 offered at
around $600/t cfr Gebze. Sellers of Russian base oils now
have more room to lower their prices without affecting
their margins following the cut in the countrys export tax
from the start of this year.
Light-grade supplies of European origin were also
available, although these were at higher prices. There
was an enquiry for a vessel to load a 2,500t cargo from
northwest Europe in mid-January to take to Gebze.
Another enquiry was for a vessel to load 6,000t of base
oils in northwest Europe in late January to take to Gebze
and Alexandria.
Turkmen supplies are available. But most such
shipments continue to be moved into Iran. Prices for the
supplies are anyway too high to compete with Russian
Route
$/t
3,000t
5,000t
Route
3,000t
5,000t
Black Sea
23-25
16-19
Augusta
41-44
30-34
Antwerp
60-65
50-55
Baltic
82-88
UAE
85-90
77-80
Mumbai
72-77
97-100
92-95
* provided at market close on 15 January by Borachart (www.borachart.com)
and European product offered into the Turkish market.

Price levels for Uzbek supplies continue to be unreflective
of market levels and are subsequently not being offered
into Turkey. There were no offers of Azeri product in the
market.
A major Turkish buyer will be seeking at the end of the
month a cargo of around 3,000t of light grades of European
origin. Another buyer has covered its requirements and
is holding off purchasing spot volumes until the end of
March.
Supplies of SN 150 in the ex-tank market were likely
available at $650-700/t. Supplies of SN 500 were at a
premium of about $25/t to these levels.
Turkeys only domestic base oils producer kept its
prices unchanged. It is offering SN 150 at 1,950 Turkish
lira/t ($845/t), SN 500 at TL2,015/t and bright stock at
TL2,265/t.
Turkeys key base oil suppliers Nov 2014
t
TurkStat
Russia 2,959
Belgium 0
Netherlands 9,245
US 1
France 21
Poland 0
Germany 43
Hungary 0
Uzbekistan 2,405
Serbia 0
Spain 0
Morocco 0
Turkmeninstan 750
Italy 16,344
Greece 11,698
Brazil 0
Ukraine 0
Iran 0
India 0
Page 13 of 28
Argus Base Oils
Russia and FSU

Russian base oil prices have extended their fall, pressured
by weak demand and the sustained drop in feedstock
prices. Buying interest from China remains muted. Many
importers in China were holding back after suffering heavy
losses in the previous quarter.
Trading activity in the Baltic market resumed after
a week-long public holiday in Russia at the start of the
year. But activity remained muted. Base oil stocks held
by trading firms in the region were likely low, while
availability has also slowed in recent weeks.
Baltic Sea Group I
$/t
Low
High
SN 150 fob
490.00
520.00
-40.00
SN 500 fob
500.00
530.00
-40.00
Low
High
Black Sea Group I
$/t
SN 150 fob
500.00
530.00
-30.00
SN 500 fob
540.00
570.00
-30.00
Low
High
SN 150 cpt
320.00
350.00
-50.00
SN 500 cpt
320.00
350.00
-50.00
Naushki Group I
Feedstock, tax costs fall further

But buyers were still holding off from replenishing their
inventories amid expectations prices will fall further. The
room for such a price move reflected pressure from lower
feedstock costs, the cut in Russias export duty and the
continuing depreciation of the Russian currency versus the
US dollar. The tax is set to fall further next month.
But supplies to the Baltic region already started to fall
last month, amid likely production cuts at some plants and
a rise in flows to the Black Sea market instead.
The market also faces a likely seasonal rise in demand
from the agricultural sector in Russias domestic market
in the coming months. Building of stocks ahead of
maintenance at several plants in early spring will also
likely add to the tighter availability of Russian supplies.
No bulk loadings were seen in the region, although
buying interest continued from Nigeria. There was an
enquiry for a vessel to load as much as 8,000t from the
Baltic and northwest European markets in late January to
take to Nigeria. Several large shipments from the Baltic
market reached Nigeria in first-half January.
The focus of activity was instead on flexibags, as
buyers sought to manage their inventories carefully.
Russian base oils, lubes rail/river exports

Dec
125
Total
Baltic Sea
000 t
000t
Dec
Overland
36.26 37.38
Nov
-1.12 Baltic
14.02
25.50 -11.48
0.00
+0.00 Kaliningrad
5.51
2.86
+2.65
Armenia
0.00
0.00
+0.00 Liepaja
4.53
7.78
-3.25
Azerbaijan
0.95
0.88
+0.07 Riga
2.72
10.90
-8.18
Belarus
1.51
1.78
-0.27 Ventspils
0.00
0.00
+0.00
China
8.51
11.30
-2.79 St.Petersburg
1.26
3.96
-2.70
Hungary
0.00
1.01
-1.01
North Korea
0.00
0.00
+0.00 Black Sea
Finland
1.48
1.22
+0.26 Eisk
0.00
0.00
+0.00
Kazakhstan
4.82
6.98
-2.16 Feodosiya
0.00
0.00
+0.00
Kyrgyzstan
0.75
0.56
+0.19 Kavkaz
8.48
0.06
+8.42
Latvia
0.12
0.48
-0.36 Novorossiysk
4.67
2.88
+1.79
Lithuania
0.24
0.29
-0.05 Reny
0.00
0.00
+0.00
Moldova
0.46
0.11
+0.35 Odessa
0.00
0.00
+0.00
Mongolia
0.44
0.39
+0.05 Azov
0.00
0.00
+0.00
Romania
1.51
2.12
-0.61
Poland
1.01
0.53
+0.48 River
Slovakia
0.00
0.00
+0.00 Volgograd
0.00
4.25
-4.25
Tajikistan
1.26
1.11
+0.15
0.25
0.35
-0.10
63.65
70.45
-6.80
Ukraine
0.24
0.72
-0.48 Far East
12.24
7.28
+4.96 Nakhodka
0.72
0.62
+0.10
13.15
2.94 +10.21
Russian base oil, lubes rail/river exports by supplier
75
50
25
Mar 14
Jul 14
Nov 14
0.00
Total Russia rail, river exports
100
0
Nov 13
Afganistan
Uzbekistan
Black Sea
Nov
Rail
Turkmenistan
Russian rail exports via Baltic/Black Sea
$/t
Dec
Nov
Volgograd
19.52
12.52
by rail
19.52
+7.00 Yaroslavl
000t
Dec
Nov
2.76
5.95
-3.19
8.27 +11.25 Ufa
1.74
3.18
-1.44
by river
0.00
4.25
-4.25 Orgkhim
2.56
1.35
+1.21
N.Novgorod
2.42
3.82
-1.40 Obninsk
1.63
1.32
+0.31
Perm
5.93
3.71
+2.22 Sofrino
1.45
1.77
-0.32
Novokuibyshevsk
5.30
10.43
-5.13 Orenburg
0.00
0.00
+0.00
Angarsk
8.86
11.08
-2.22 Other
3.50
5.83
-2.33
Omsk
7.98
9.49
63.65
70.45
-6.80
Total
Page 14 of 28
-1.51
Argus Base Oils
Russia and FSU

Wide bid-offer spread hampers activity
But the wide price spread between buying and selling
ideas on a cpt Posin basis continued to hamper activity.
Some buyers were targeting prices at $420-450/t cpt Posin
for SN 150 and SN 500. Suppliers offers were at around
$460-500/t cpt Posin.
Rosneft sold through its recent tender for Januaryloading supplies 1,200t of SN 400 and 660t of bright stock
originating from the Yaroslavl refinery at $460/t and
$470/t cpt Posin respectively.
The company offered through a new tender on 15
January up to 3,900t of supplies from the Yaroslavl
refinery and 7,500t of base oils from its Novokuibyshevsk
plant. The supplies are scheduled for late January and
early February loading.
Naftan cuts prices
Naftans Belarus refinery cut its prices for SN 150 by 79/t
to 461/t ($544/t) fca refinery. It cut its price of SN 500
by 65/t to 405/t. It cut its Group III 4cst price by 85/t
to 555/t. It maintained its price for SN 1200 at 530/t
fca refinery. The price cut boosted buying interest in the
supplies. The refiner sold 940t of SN 150 and 2,160t of SN
500 at the lowered price levels.
Naftans base oils unit was possibly operating at
minimum rates. Any increase in run rates was dependent
on a recovery in prices.
Ukrainian demand rises
Prices for Russian base oils in the Ukrainian market
have firmed, supported by stronger demand in country.
Ukrainian buyers took 420t of bright stock from Rosnefts
Yaroslavl refinery at $480-490/t cpt Solovey and 300t of SN
400 at around $450/t cpt. Some domestic importers also
bought 3,000t of SN 150 from Novokuibyshevsk refinery at
$500/t cpt Solovey.
Some light-grade base oils originating from Omsk
refinery were likely sold at $480-500/t cpt Solovey.
Price offers for SN 350 and SN 500 originating from
Azerbaijan fell sharply, following the plunge in fuel oil
prices. Offer levels fell to around $500-510/t and $510520/t cpt Solovey respectively.
Turkish demand begins to stir
There were signs of a pick-up in buying interest from
Turkish buyers in the Black Sea market. But the interest
has failed to translate into deals.
Turkish base oil imports from Russia slumped in
Russian and Belarusian base oil export duty *

Feb 2015
Jan 2015
54.10
Aug 2014
Dec 2014
81.60
183.10
Jul 2014
256.30
Nov 2014
Jun 2014
254.20
209.00
May 2014
254.10
$/t
Oct 2014
227.50
Apr 2014
248.20
255.40
Sep 2014
242.60
Mar 2014
253.70
* tax paid by producer for base oils export outside of Russia, Belarus,
Kazakhstan, Tajikistan and Kyrgyzstan
Naftan base oil offers and trades, 09-15 Jan *

Volume offered
(t)
Price, fca
(/t)
SN 150
940
461
544
940
SN 500
2,160
405
478
2,160
SN 1,200
1,000
530
626
5cst
2,000
555
655
Grade
Price, fca Volume sold

($/t)
(t)
* for imports into EU, Turkey, USA import tax of 3.7% will be charged
BNTD, traders
Baltic loadings
Port/terminal
Vessel
Next port
Riga
Wappen Flnsbrg
WAF
Volume B/L Date

7,000 24-25 Dec
Svetly
Brovig Marin
ARA
3,000 20-21 Dec
Svetly
Key Breeze
ARA
4,000 17-18 Dec
Svetly
Antares
North Europe
2,000 15 Dec
Svetly
Coolwater
ARA
2,700 12 Dec
Riga
Rio Dauphin
WAF
8,200 30 Nov
Svetly
Besiktas Galata
ARA
3,500 22 Nov
Svetly
Golfstraum
ARA
6,200 18 Nov
Svetly
Amber 1
Hull, UK
4,000 13 Nov
Svetly
Orasund
Hull, UK
2,700 7 Nov
Riga
Mentor
WAF
5,000 6 Nov
Liepaja
Lexus
Hull, UK
3,000 22 Oct
Svetly
Besiktas Iceland
Antwerp
5,300 21 Oct
Liepaja
Ternland
Gdansk/Rdam
4,500 15 Oct
Liepaja
Deniz A
Rotterdam
3,500 mid-Oct
Svetly
Ls Eva
Antwerp
4,000 14 Oct
Svetly
Lotus
Rotterdam
3,800 7 Oct
Svetly
Donizetti
Dordrecht
2,000 4 Oct
Svetly
Amber 1
Rotterdam
3,500 20 Sep
November to their lowest level in six years. But Russian

supplies will likely be more attractive this year, as the
sharp cut in the export duty on the supplies give sellers
more room to offer competitive prices.
Price offers were seen at around $520-530/t fob Black
Sea for SN 150 and around $540-550/t for SN 500.
A large cargo was likely loaded earlier this month,
curbing availability of SN 500. The shipment is likely bound
for the Mideast Gulf.
Chinese importers slash bid levels
Prices in the Naushki market fell, pressured by sluggish
buying activity and lower bids from Chinese importers.
Page 15 of 28
Argus Base Oils
Russia and FSU

These buyers remain cautious about committing to large
volumes because of expectations that prices will fall
further. They are targeting prices at around $300/t cpt
Naushki.
Rosneft offered through a new tender more supplies
from its Angarsk refinery. It offered up to 360t of each
grade, for loading in late January and early February.
The company sold only a small volume of base oils in its
previous tender at around $350/t cpt Naushki. Some bids
for those supplies were possibly lower than $200/t.
The Russian export duty for base oils in February will
be cut by $27.50/t to $54.10/t. The cut to an already low
export tax will add to the competitiveness of Russian
supplies.
The Argus Russian diesel index eased to 30,710
roubles/t ($465/t), pressured by surplus supplies in the
domestic market.
Russian domestic base oil supplies

Supplier
Rosneft Novokuibyshevsk
000t
Nov. 14
Oct. 14
11,64
-1,69
Bashneft Ufa
7,53
1,82
Lukoil Perm
6,74
0,45
Gazpromneft Omsk
9,00
0,52
Rosneft Angarsk
4,40
0,99
Lukoil Nizhny Novgorod
7,05
1,09
Gazpromneft/Rosneft Yaroslavl
4,59
-0,23
Lukoil Volgograd
4,38
-0,50
Obninskorgsintez
0,15
-0,35
Orgkhim
2,31
-0,18
Rosa-1
0,78
-0,06
Shaumyan lube plant
0,18
-0,34
Lukoil Tyumen
0,41
-0,11
Sofrino lube plant
0,28
-0,08
Rosneft Ryazan
0,18
-0,05
Experimental plant Neftekhim
0,00
-0,08
Orenburg lube plant
0,02
-0,12
50,78
-7,56
110,42
-6,48
Others
Total
FSU key producers SN 500 price (netback) *
Perm
To Baltic Sea
$/t
$/t
353
To Black Sea
To Naushki
135
Ufa
$/t
To Baltic Sea
348
To Black Sea
382
To Naushki
135
Volgograd
$/t
To Baltic Sea
357
To Black Sea
418
To Naushki
Omsk
$/t
To Baltic Sea
323
To Black Sea
352
To Naushki
165
97
* price calculated by subtracting transport costs and taxes between the producer and the fob Baltic, fob Black Sea and cpt Naushki pricing point.
Page 16 of 28
Argus Base Oils
US
US base oil prices have extended their fall, as a further
slide in crude prices raised expectations of another
downwards adjustment to posted prices.
Such expectations dampened already fragile demand,
as buyers picked up the volumes needed to cover
requirements to maximise their benefit from such a price
adjustment. Similar price cuts were already announced
this week in Europe and in Asia-Pacific. Growing
expectations of such a move in the US follow a fall of more
than $12/bl in crude prices (30/USG) since the last base
oil posted price adjustment.
But producers could seek to hold off such a move
because of expectations that a price cut at the start of
the year would be unlikely to bolster demand, especially
while crude prices remain volatile. They could instead
seek to hold off making any such adjustments until the
expected start of a seasonal pick-up in demand from early
February.
But active price discounts of as much as 20-60/USG
to postings highlighted the extent of the weak demand
and moves to respond to expectations of lower prices in
the domestic market. Overseas buyers are asking for even
larger discounts from US suppliers in their negotiations for
February-loading cargoes.
Domestic Group II N100 price indications surfaced
either side of $2.10/USG, with premiums to this level
for smaller volumes. The premium of N200-230 to N100
continued to narrow amid oversupply in the US Gulf coast
market. The premium of domestic N600 over light grades
has slumped during the past half-year and continued to
narrow further. It dropped to levels on either side of
$2.32/USG, again with stronger premiums for smaller
volumes.
US Group II light-grade prices have held below Group I
prices since early 2013, reflecting the plentiful supply of
US SN 150 domestic premium to heating oil
$/USG
0.60
0.55
0.50
0.45
Group I bulk export prices
Low
High
SN 150 fob
1.80
1.96
-0.10
545.00
594.00
-30.50
SN 500 fob
2.07
2.23
-0.15
617.00
665.00
-44.50
Bright stock fob
3.22
3.38
+0.00
947.00
994.00
+0.00
Group II bulk export prices
$/t
High
Low
High
N100 fob
1.72
1.88
-0.10
533.00
583.00
-31.00
N200 fob
1.76
1.92
-0.09
537.00
586.00
-27.00
N220 fob
1.76
1.92
-0.09
537.00
586.00
-27.00
N600 fob
1.87
2.03
-0.13
561.00
609.00
-39.00
Low
High
Low
High
SN 150
2.08
2.24
-0.05
630.00
679.00
-15.00
SN 500
2.30
2.46
-0.10
685.00
733.00
-30.00
Bright stock
3.47
3.63
+0.02 1,020.00 1,067.00
+6.00
N100
2.01
2.17
-0.02
623.00
673.00
-6.00
N200
2.05
2.21
-0.06
625.00
674.00
-18.50
N220
2.05
2.21
-0.06
625.00
674.00
-18.50
N600
2.24
2.40
-0.03
672.00
720.00
-9.00
4cst
3.18
3.34
-0.12 1,002.00 1,052.00
-38.00
6cst
3.22
3.38
-0.10 1,014.00 1,065.00
-31.50
8cst
3.23
3.39
-0.10 1,017.00 1,068.00
-31.50
Domestic prices
$/USG
$/t
Group I
Group II
Group III
Naphthenic domestic prices
$/USG
$/t
Low
High
Low
High
Pale oil 60
2.79
2.95
-0.12
827.00
874.00
-35.50
Pale oil 100
3.16
3.32
-0.07
926.00
973.00
-21.00
Pale oil 500
3.03
3.19
-0.05
871.00
916.00
-14.50
Pale oil 2000
3.13
3.29
-0.09
893.00
939.00
-25.50
Naphthenic bulk export prices
$/USG
$/t
Low
High
Low
High
Pale oil 60 fob
2.46
2.62
-0.15
729.00
776.00
-44.50
Pale oil 100 fob
2.66
2.82
-0.06
780.00
827.00
-17.00
Pale oil 500 fob
2.71
2.87
-0.07
779.00
825.00
-20.00
Pale oil 2000 fob
2.83
2.99
+0.00
807.00
853.00
+0.00
0.30
12 Sep 14
$/USG
Low
0.35
16 May 14
$/t
High
0.40
0.25
17 Jan 14
$/USG
Low
16 Jan 15
Page 17 of 28
Argus Base Oils
US
the premium-grade product. But the premium of Group I
Argus spot prices over Group II has been narrowing during
the past two months and narrowed further to around
5-8/USG, reflecting the move by lubricant manufacturers
away from the grade.
But bright stock supplies have tightened since refiners
began cutting production in October. The tighter supplies
have offered price support for the grade, boosting prices
in the spot market back up to levels just below $4.00/USG
in the Brownsville, Texas market. The stronger price level
has prompted persistent moves by Mexican buyers to look
to lower priced supplies from Europe. But finalising a deal
for bright stock only is difficult.
Prices for Group III have extended their fall, amid
rising global supplies of premium-grade base oils. Besides
the start-up of the SK/Repsol 630,000 t/yr Group III base
oils plant in Cartagena, Spain last September, ExxonMobils
expanded Group II+ production at its Baytown plant is to
start this quarter.
Indian demand shows signs of firming
There was renewed interest in moving cargoes of surplus
US Group I and Group II supplies to overseas outlets. US
Group I cargoes of SN 150 were offered as low as $1.65/
USG fob.
Cargo offers from the US Gulf coast to India resurfaced
last week and gained traction this week. Price offers
at levels below $1.80/USG fob for N100, N220 and N600
attracted more serious buying interest than in previous
weeks. Tighter availability in Asia-Pacific in March because
of maintenance is possibly spurring demand for alternative
supplies.
But the market price volatility has complicated
the shipment of cargoes from the US to India. A vessel
originally scheduled to load a cargo in December for India
is now loading two cargoes totalling 16,000t of Group II
from the US Gulf coast. It is scheduled to load the second
cargo around now.
Group I moves to Latin America
There were several vessel enquiries to move Group I
cargoes ranging between 1,750t and 6,600t in size from
various European ports to take to Colombia and Brazil.
A major trading company that likely won Venezuelan
state-owned PdVs latest tender fixed its own timechartered vessel to move 15,000t of Group I base oils from
Houston to Punta Cardon. The cargo likely loaded around
12-13 January. It is expected to reach Punta Cardon around
US SN 500 forward prices
$/USG
$/t
Low
High
Low
High
Feb 2015
2.13
2.18
-0.15
633.25
648.15
-44.70
Mar 2015
2.10
2.15
-0.15
625.45
640.35
-45.35
Apr 2015
2.08
2.13
-0.15
620.50
635.40
-45.10
2Q 2015
2.09
2.14
-0.15
621.95
636.85
-44.75
3Q 2015
2.13
2.18
-0.14
635.00
649.90 -42.90
maintain its existing profit margin relative to Nymex heating oil futures.
US SN 500 forward premium to heating oil

$/USG
$/t
Midpoint
Midpoint
Feb 2015
0.36
-0.07
107.45
-20.40
Mar 2015
0.39
-0.06
115.25
-19.80
Apr 2015
0.40
-0.07
120.25
-20.00
2Q 2015
0.40
-0.07
119.20
-20.85
3Q 2015
0.35
-0.08
104.30
-23.85
The premium shows the implied forward-curve profitability of fob US
export SN 500 relative to Nymex heating oil futures.
Crude
$/USG
$/bl
Nymex WTI crude front month
1.10
-0.06
46.25
-2.54
SN 500 premium to WTI
1.05
-0.09
44.09
-3.73
Argus Sour Crude Index (ASCI)
1.02
-0.06
42.79
-2.66
SN 500 premium to ASCI
1.13
-0.09
47.55
-3.61
Oil products
$/USG
$/bl
NYH heating oil barge
1.58
-0.09
66.25
-3.86
Low sulphur VGO 0.5% cargo
1.35
-0.07
56.75
-3.04
High sulphur VGO 2% cargo
1.30
-0.05
54.75
-2.04
USGC 10ppm diesel 62 cargo
1.51
-0.05
63.30
-2.21
Oil products premiums

Heating oil premium to WTI
0.48
-0.03
20.00
-1.32
Heating oil premium to VGO 2%
0.28
-0.04
11.50
-1.82
SN 500 premium to heating oil
0.57
-0.06
24.10
-2.41
SN 500 premium to VGO 2%
0.85
-0.10
35.59
-4.23
US SN 500 premium to VGO 2%
$/USG
1.60
1.40
1.20
1.00
0.80
0.60
0.40
17 Jan 14
Page 18 of 28
16 May 14
12 Sep 14
16 Jan 15
Argus Base Oils
US
20 January.
European bright stock is still being offered and sold
into Mexico at around $3.40-3.45/USG delivered. For
Mexican buyers, the price level is lower than purchasing
bright stock from the US.
More majors cut finished lubricant prices
More producers of finished lubricants announced price
cuts for their products. Phillips 66 will cut the prices
for its finished lubricants by 4.5pc with effect from 2
February. ExxonMobil and Shell will both cut prices for
their lubricants by 3.5pc. Exxons price cuts take effect on
2 February. Shells price cuts take effect from 19 January.
Chevron was the first major blender to announce price
cuts for finished lubricants in late December. Chevrons
3.5pc price cut will take effect on 6 February.
The reductions contrast with the more than 40pc fall in
base oil prices during the second half of 2014.
Margins rise on falling crude, VGO
The premium of SN 150 over four-week average vacuum
gasoil (VGO) held firm at $0.75/USG for the second
consecutive week. The premium of N100 over VGO nudged
up to $0.68/USG, remaining unusually firm for the time of
year.
The premium of base oil prices to ultra-low-sulphur
diesel has also remained firm, at their highest levels since
last summer. The relative strength partly reflects the
impact of the warmer winter, which has curbed demand
for heating oil. Refineries have also been running at high
rates as they take advantage of lower priced crude. The
result is an oversupply of distillates and weaker prices,
making it increasingly lucrative to produce base oils
instead.
Base oil prices have tracked lower crude and VGO
prices relatively closely in recent months, reflecting the
oversupply and increased capacity of the product. The
drop in base oil prices was more delayed in previous
downwards crude movements. Markets linked to base oils,
such as polyalphaolefins or petroleum wax, have shown
remarkable price steadiness compared with base oils amid
more balanced supply-demand fundamentals.
US naphthenic base oil prices fell more steeply than

paraffinic base oil prices, as further posted price cuts
surfaced.
Calumet said on 13 January that it will cut the price
of all its naphthenic grades by 20/USG with effect from
22 January. The move came after Ergon cut its domestic
prices by 15-25/USG on 13 January. Other naphthenic
producers are currently evaluating their positions.
Blenders and international buyers also noticed
considerable volume discounts from some producers,
indicating growing supply length in the market. The high
price levels have also eroded their competitiveness versus
competing light-grade Group II prices. The premium of
pale oil 60 over Group II N100 rose earlier this month to its
highest level since last May.
But any supply overhang could ease in February. Cross
Oil and San Joaquin Refining will carry out turnarounds at
their naphthenic refineries at the end of next month. San
Joaquin Refining will shut down its entire refinery for the
last two weeks in February for a planned turnaround. It is
expected to build its inventories ahead of the shutdown.
The premium of domestic pale oil 60 over four-week
average of Light Louisiana Sweet crude remained firm,
even after slipping by more than $2.00/bl to just below
$68/bl.
Vessel enquiries: US
Loading port
Next port
B/L Date
Volume
Lake Charles
India
Jan/ely Feb
10,000-15,000
W. Med
Colombia
prompt Jan
1,750
Rotterdam
San Juan
2H Jan
1,500-2,000
Livorno/Antwerp
Santos/Rio
18-25 Jan
6,600 + 2,500
W. Med
Houston
prompt Jan
4,000-5,000
Vessel fixtures: US
Vessel
Loading port
Next port
B/L Date
Volume, t
Freight, $/t
Furuholmen
Houston
Punta Cardon
12-13 Jan
15,000
---
Fairchem Mustang
USG
Durban
2H Jan
8,800
---
Sichem Aneline
Malacca
Santos/Durban
end-Dec
7,500
150s
Page 19 of 28
Argus Base Oils
US posted prices
$/USG
Group I *
ExxonMobil Gulf coast
Effective
$/USG
from
70/75
HollyFrontier
Effective
$/USG
from
Paulsboro Refining east coast

Effective
$/USG
from
17 Dec 14
2.59
-0.45
100
22 Dec 14
2.50
-0.45
17 Dec 14
2.59
-0.45
26 Dec 14
2.75
-0.45
150
22 Dec 14
2.55
-0.40
17 Dec 14
2.77
-0.45
26 Dec 14
2.70
-0.40
17 Dec 14
2.68
-0.45
22 Dec 14
2.57
-0.45
17 Dec 14
2.93
-0.45
26 Dec 14
2.79
-0.45
22 Dec 14
2.65
-0.45
26 Dec 14
2.82
-0.45
26 Dec 14
4.06
-0.35
250
300/350
500
600/650
700
Bright stock
22 Dec 14
3.91
-0.35
17 Dec 14
4.12
-0.35
Calumet Shreveport
Effective
$/USG
from
22 Dec 14
3.05
-0.45
22 Dec 14
4.12
-0.35
Group II *
Phillips 66 Gulf coast
Effective
$/USG
from
Chevron Gulf coast

Effective
$/USG
from
Motiva Gulf coast

Effective
$/USG
from
FHR Gulf coast

Effective
$/USG
from
70
16 Dec 14
2.55
-0.60
18 Dec 14
2.63
-0.50
75/80
16 Dec 14
2.55
-0.60
18 Dec 14
2.63
-0.50
100/120
16 Dec 14
2.45
-0.60
17 Dec 14
2.45
-0.50
16 Dec 14
2.45
-0.50
18 Dec 14
2.45
-0.50
200/220
16 Dec 14
2.60
-0.65
17 Dec 14
2.60
-0.55
16 Dec 14
2.60
-0.55
18 Dec 14
2.60
-0.55
600
16 Dec 14
2.80
-0.65
17 Dec 14
2.80
-0.55
16 Dec 14
2.80
-0.55
18 Dec 14
2.80
-0.55
Group II *
US domestic SN 150 vs posted prices
Calumet Shreveport
Effective
from
$/USG
80
22 Dec 14
2.69
-0.50
100
22 Dec 14
2.56
-0.50
150
22 Dec 14
2.99
-0.50
325
22 Dec 14
3.45
-0.55
4.50
US SN 150
Paulsboro
ExxonMobil
$/USG
HollyFrontier
4.00
3.50
Group II+ *
SK Lubricants Gulf coast
Effective
from
$/USG
Effective
from
$/USG
16 Dec 14
3.67
-0.40
18 Dec 14
4.24
-0.40
16 Dec 14
3.77
-0.40
50/60
70/80
3.00
2.50
2.00
10 Jan 14
16 May 14
12 Sep 14
16 Jan 15
Group II+ *
Effective
from
$/USG
110/130
22 Dec 14
2.79
-0.45
190
22 Dec 14
2.59
-0.50
6.00
US N600
Phillips 66
Chevron
$/USG
Motiva
FHR
5.00
Group III *
Effective
from
US domestic N600 vs posted prices
$/USG
Effective
from
16 Dec 14
3.98
-0.40
16 Dec 14
4.08
-0.40
4cst
18 Dec 14
4.51
-0.40
6cst
18 Dec 14
4.51
-0.40
8cst
18 Dec 14
4.54
-0.40
$/USG
*the column shows the price difference between the current and previous
posted price
4.00
3.00
2.00
10 Jan 14
Page 20 of 28
16 May 14
12 Sep 14
16 Jan 15
Argus Base Oils
US posted prices
$/t
Group I *
Effective
$/t
from
70/75
HollyFrontier
Effective
$/t
from
Paulsboro Refining east coast

Effective
$/t
from
17 Dec 14
802.90
-139.50
100
22 Dec 14
770.00
-138.60
17 Dec 14
797.72
-138.60
26 Dec 14
844.25
-138.15
150
22 Dec 14
782.85
-122.80
17 Dec 14
850.39
-138.15
26 Dec 14
815.40
-120.80
17 Dec 14
814.72
-136.80
22 Dec 14
778.71
-136.35
17 Dec 14
884.86
-135.90
26 Dec 14
837.00
-135.00
22 Dec 14
789.70
-134.10
26 Dec 14
834.72
-133.20
26 Dec 14 1,201.76
-103.60
250
300/350
500
600/650
22 Dec 14
700
Bright stock
22 Dec 14 1,161.27
-103.95
Calumet Shreveport
Effective
$/t
from
17 Dec 14 1,223.64
-103.95
908.90
-134.10
22 Dec 14 1,222.77
-103.88
Group II *
Effective
$/t
from
Chevron Gulf coast

Effective
$/t
from
Motiva Gulf coast

Effective
$/t
from
FHR Gulf coast

Effective
$/t
from
70
16 Dec 14
790.50
-186.00
18 Dec 14
815.30
-155.00
75/80
16 Dec 14
780.30
-183.60
18 Dec 14
804.78
-153.00
100/120
16 Dec 14
757.66
-185.55
17 Dec 14
757.05
-154.50
16 Dec 14
759.50
-155.00
18 Dec 14
757.66
-154.63
200/220
16 Dec 14
792.35
-198.09
17 Dec 14
793.00
-167.75
16 Dec 14
793.00
-167.75
18 Dec 14
792.35
-167.61
600
16 Dec 14
844.20
-195.98
17 Dec 14
844.20
-165.83
16 Dec 14
845.60
-166.10
18 Dec 14
844.20
-165.83
Group II *
US base oil production, sales

Effective
from
$/t
80
22 Dec 14
830.13
-154.30
100
22 Dec 14
786.59
-153.63
150
22 Dec 14
916.02
-153.18
325
22 Dec 14
1,051.11
-167.57
Calumet Shreveport
7,000
Group II+ *
$/t
50/60
70/80
000 bl
Sales
EIA
6,000
5,000
4,000
3,000

Effective
from
Production
18 Dec 14 1,335.60
-126.00
Effective
from
$/t
16 Dec 14 1,183.58
-129.00
16 Dec 14 1,206.40
-128.00
2,000
1,000
0
Oct 13
Feb 14
Jun 14
Oct 14
Group II+ *
Effective
from
$/t
110/130
22 Dec 14
873.27
-140.85
190
22 Dec 14
805.49
-155.50
4cst
Exports
3,000
Imports
000 bl
Net imports
EIA
2,000
Group III *
Effective
from
US base oil exports, imports
$/t
18 Dec 14 1,420.65
-126.00
6cst
18 Dec 14 1,420.65
-126.00
8cst
18 Dec 14 1,430.10
-126.00
Effective
from
16 Dec 14 1,263.65
-127.00
16 Dec 14 1,277.04
-125.20
-1,000
*the column shows the price difference between the current and previous
posted price. The $/t price is converted from the $/USG price.
Refer to www.argusmedia.com for methodology with the gallons-to-tonnes
conversion factors.
1,000
$/t
-2,000
Oct 13
Page 21 of 28
Feb 14
Jun 14
Oct 14
Argus Base Oils
Market news and analysis
Indias December base oil imports hold steady
Indias base oil imports held firm in December,

supported by steady shipments from South Korea that
countered a sharp slowdown in flows from the US.
Imports totalled 187,695t in December, port data
showed. The volume was 5pc higher than the same month
a year earlier. Total imports in 2014 rose by 20pc from a
year earlier to a record 2.45mn t on the back of a surge in
flows from South Korea and the US.
But imports in November and December were lower
than earlier months. Such deliveries had exceeded the
200,000 t/month level seven times last year, mostly
because of a surge in shipments from the US. The relative
slowdown in imports at the end of last year reflected
moves by buyers to cut back inventories and supplies
involving long voyage times, as they shunned exposure to
the extreme price volatility during the final quarter of
2014.
Imports from South Korea were 113,885t in December.
The volume was more than 5pc higher than the same
month a year earlier and steady from the previous month.
Record-high imports of 1.38mn t in 2014 were 34pc higher
than the previous year.
Imports held firm in December as buyers increasingly
limited their requirements as they sought to cut their
inventories. They covered such needs through term
cargoes from key suppliers in South Korea rather than
through spot shipments.
Buyers also preferred shipments with a shorter delivery
time. Shipments from South Korea to India typically take
about 22 days. The voyage time for supplies from the US
to India is about 42 days.
The longer voyage time for shipments from US slashed
buying interest in such cargoes. Imports from the US fell
2
Indian base oil imports

2012
275
000 t
2013
2014
Port data
250
225
200
175
150
125
Jan
May
Sep
|
Dec
to 8,990t in December, down from more than 42,000t the

same month a year earlier and the lowest volume since
September.
The slowdown reflected buyers concern that market
prices will fall significantly lower than the prices they
bought at by the time such cargoes reached India. Such a
scenario already took place with the delivery of supplies
in October. The shipments had been bought at much
higher price levels in August.
Total imports of 257,490t from the US in 2014 were
6pc lower than the previous year. The drop in imports
reflected the sharp fall in shipments in the last few
months of last year. But the volume remained unusually
high compared with recent years, reflecting the growing
supply overhang in the US and the increasingly frequent
flow of shipments from this market to India.
Base oil imports from Russia fell for a third straight
month in December to just 800t. The volume was the
lowest in 19 months and compared with average shipments
of more than 8,000 t/month last year. The slowdown
reflected buyers concern that prices would fall further.
It also reflected waning demand for Group I heavygrade supplies, as buyers increasingly switched to using
competitively priced Group II base oils.
Total imports of 96,440t from Russia in 2014 were more
than double year-earlier volumes of less than 42,000t. The
surge in supplies reflected firm demand in the first half of
the year, especially when prices were more competitive
compared with supplies from Iran.
Indian base oil imports from UAE and Iran combined
came to 7,450t in December. The volume was down from
more than 10,700t the same month a year earlier and
from more than 11,000t in November. The slowdown
similarly reflected waning demand for Group I base oils.
But import volumes have recovered in the last few months
of the year, reflecting the attraction of securing supplies
from logistically closer sources.
Imports from Singapore remained firm at 21,510t in
December. Total imports of 232,120t in 2014 were more
than 60,000t higher than the previous year. The steady
rise in imports came even ahead of the start-up of new
production capacity in Singapore at the start of this year.
Indias base oil imports from Spain surged to 16,740t in
December. The volume exceeded total imports from Spain
over the previous three years combined. The supplies
were mostly premium quality light-grade base oils. The
surge in such shipments followed the start-up of SK
Lubricants and Repsols joint-venture Group III base oils
plant in Spain last September.
Page 22 of 28
Argus Base Oils

1
Turkeys November base oil imports fall
Turkeys base oil imports fell in November for a fifth

month out of six, as buyers minimised deliveries to limit
their exposure to any further drop in prices.
Imports fell to 45,330t in November, government data
showed. The volume was 27pc lower than the same month a
year earlier. Total imports of 497,185t in the first 11 months
of the year were 20pc lower than the same period last year.
Imports have been sliding throughout the year amid
tighter regulations on such shipments. But the slowdown
in recent months has been exacerbated by the sharp fall in
base oil prices. With no way to cover their exposure to such
a price drop, buyers have sought to minimise inventories
and cut back purchases.
They have also tapped the ex-tank market to cover
immediate requirements. But production and sales from
Turkeys only base oils unit have remained unusually low.
Production of 11,000t in October was barely a third of the
plants capacity. Base oil sales from the plant came to just
9,000t.
Supplies from Greece and Italy continued to hold firm, as
buyers secured on-specification supplies at steep discounts
to market prices. Regional refiners also sought to clear
their own inventories before the end of the year and in
response to slumping prices.
Imports from Italy surged to 16,345t in November. The
volume was up from 9,550t the previous month and the
highest level since December 2013.
Imports from Greece rose to 11,695t in November, up
from 8,230t the previous month. Total imports of 130,385t
from Greece in the first 11 months of the year were 48pc
higher than the same period last year. The surge in supplies
reflected the impact of the imposition of a 3.7pc import tax
on supplies from Russia at the start of last year. The higher
cost of the Russian supplies boosted the competitiveness
of supplies from Greece, which also benefited from their
proximity to Turkey, cutting freight costs.
2
Turkish base oil imports

2012
100
000 t
2013
2014
TurkStat
90
80
70
60
50
40
30
Jan
May
Sep
|
Dec
But Turkish base oil imports from Russia fell to just

2,960t in November. The volume was the lowest level since
August 2008. The slump in shipments reflected their less
competitive prices and extended a trend that began at the
start of the year. Total imports of 97,704t from Russia in
the first 11 months of the year were down from more than
160,000t the same time a year earlier.
Imports from the Netherlands rose to 9,245t in
November. The volume was the highest in more than
six years. Many European refiners were offering surplus
supplies at attractive prices in last years final quarter in a
bid to clear high stocks.
China raises oil product consumption taxes again
China has raised consumption taxes on oil products for

the third time in six weeks amid a continued fall in global
crude prices.
Taxes will rise by 9pc on most products, effective
tomorrow, the finance ministry and state taxation
administration said. The tax increase was announced in
tandem with a cut in motor fuel prices, lessening its impact
on consumers.
The latest tax rise is smaller than the previous increases on
29 November and 13 December that raised consumption taxes
by a combined 37-40pc. Consumption taxes had previously
been unchanged since they were first imposed in 2009.
The consumption tax on gasoline, naphtha, solvents
and lubricants will increase by 0.12 yuan/litre (2/l) to
Yn1.52/l, while the tax on diesel, jet-kerosine and fuel
oil will increase by Yn0.1/l to Yn1.2/l. But the tax on
jet-kerosine will not be imposed, as previously, to protect
domestic airlines.
The tax increase is designed to manage consumption,
reduce oil demand, cut air pollution and speed reforms in
the way energy is produced and consumed in China, the
government agencies said.
But the increases are robbing Chinese consumers of some
of the benefits of lower prices. Top regulator the NDRC
on 12 January reduced its price ceilings for gasoline by
Yn180/t and for diesel by Yn230/t, reflecting falling crude
values. This is well below the price cuts of Yn395/t and
Yn380/t respectively that would have been implemented
under the NDRCs fuel pricing mechanism if consumption
taxes had not risen.
The NDRC would have reduced gasoline and diesel prices
by an extra Yn725/t and Yn460/t respectively in November
and December, without the previous consumption tax hikes.
Chinas consumption taxes are paid by refiners, which
then pass the costs on to consumers. The total tax burden
comprises VAT, consumption tax and other taxes. Tax hikes
have led to a rise in inflows of smuggled diesel and increasing supply of private-sector blended gasoline, which has
undermined demand for fuel produced by local refineries.
2
Page 23 of 28
Argus Base Oils
Chinas December car sales rise
Chinas car sales rose in December for a 22nd straight

month, while Japanese auto sales rose for the first time
in six months. Indian car sales got a lift ahead of the
expiry of tax breaks.
Chinese car sales rose by 16pc in December to 2.06mn,
according to the countrys association of automobile
manufacturers. The increase outpaced the 10pc rise in sales
in 2014 to 19.7mn. The annual increase also slowed from a
15.7pc rise in sales in 2013.
Total automobile sales rose by 12.9pc in December to
2.41mn. Total sales in 2014 rose by 6.9pc to 23.49mn. The
increase slowed from a 13.9pc rise in sales in 2013.
Sales of sedan cars rose by 7.4pc in December to
1.26mn. Total sales in 2014 rose by 3.1pc to 12.38mn. Sales
of sports utility vehicles (SUVs) rose by 56pc in December
to 492,000. The increase outpaced the 36pc rise in sales in
2014 to 4.08mn.
China-branded cars accounted for 41.2pc of total sales
in December, down by 2.1 percentage points from the same
month a year earlier.
Japans automobile sales rose in December for the
first time in six months. Sales rose by 2.1pc to 431,918.
Sales had slumped since April following an increase in the
countrys consumption tax that month. Total sales rose by
3.5pc in 2014 from the previous year to 5.56mn.
Indias car sales rose in December for a second month,
as buyers brought forward their purchases ahead of the end
of tax breaks on car sales. Total car sales rose by 15pc in
December to 152,740, according to the Society of Indian
Automobile Manufacturers. The lower excise duty on car
sales was introduced last February in a bid to help revive
the industry. It was then extended in June until the end of
last year.
Fuel prices in India have also fallen, although their
impact has been partially countered by the removal of
2
China/Japan/India car sales

2,500
China
Japan
000
India
2,000
1,500
1,000
government controls on diesel prices since October.

Even with the benefit of last years lower excise duty
to spur sales, the recovery in demand remained weak.
Total sales of 1.85mn in 2014 were just 2pc higher than the
previous year. But demand remained far lower than sales of
more than 2mn in 2012.
Taiwan car sales rose by 7pc in December to 41,799.
Total sales of 423,829 in 2014 rose by 12pc from the
previous year to the highest level since 2005.
Australian automobile sales nudged higher in December
for the first time in three months, supported by a
sustained rise in SUV sales. Total auto sales rose by 0.1pc
in December to 96,809. Passenger car sales fell by 5.5pc in
December to 45,051, while SUV sales climbed by 7.4pc to
30,666.
The sustained strength of SUV sales pushed their share
of auto sales in 2014 to 31.7pc of the total, up from 29.4pc
in 2013. By contrast, passenger cars accounted for 47.8pc
of total auto sales last year, down from 49.8pc the previous
year.
1
Strike at Colas Dunkirk refinery hits output
A strike in protest against the loss of jobs at Colas

speciality products refinery in Dunkirk, France, is
disrupting production and loadings of base oils.
Colas said that it is unclear when the strike, which
started on 14 January, will end and production and loadings
resume.
The company and French trade union federation CGT
will meet tomorrow to negotiate the loss of jobs resulting
from the planned discontinuation of base oils and paraffin
production.
After several rounds of strikes and negotiations, Colas
proposed to maintain 109 of the 275 jobs but the CGT is
pushing for another 11 positions to be kept.
Colas announced plans to discontinue its base oils and
paraffin production after forecasting an operating loss
between 45mn-50mn ($52mn-58mn)for 2014. The company
will continue production until at least March to fulfil its
term contracts.
Colas acquired the Dunkirk site from ExxonMobil and
Total in July 2010.As part of the acquisition, the refinery
benefited from a processing contract with Total that
covered 40pc of its production until the end of 2012. In
2013, Colas produced 294,000t of bitumen, 258,000t of
base oils, 304,000t of fuel oils and 48,000t of paraffin.
2
500
0
Jun 13
Dec 13
Jun 14
Dec 14
Page 24 of 28
Argus Base Oils
maintenance and shutdowns

Upcoming / recent base oil plant maintenance / shutdowns / closures
Refiner
Location
Timing
Capacity
Capacity affected Cause
Shell
Pernis, Netherlands
Late 2015
370,000 t/yr
All
Closure
Total
Gonfreville, France
Oct 2015
500,000t/yr
250,000t/yr
Closure
S-Oil
Onsan, South Korea
2H 2015
41,000 b/d
13,000 b/d
Maintenance
S-Oil
Onsan, South Korea
2H 2015
41,000 b/d
28,000 b/d
Maintenance
JX Nippon
Wakayama, Japan
Jun 2015
176,000 t/yr
NA
Maintenance
JX Nippon
Mizushima, Japan
May 2015
225,000 t/yr
All
Maintenance
Rosneft
Angarsk, Russia
May 2015 for 1 month
250,000 t/yr
NA
Maintenance
Neste
Porvoo, Finland
April 2015 for 8 weeks
250,000 t/yr
NA
Maintenance
Idemitsu
Chiba, Japan
Mid-Apr 2015 for 60-80 days
305,000 t/yr
All
Maintenance
Rosneft
Novokuibyshevsk, Russia
April 2015
350,000 t/yr
All
Maintenance
Gazpromneft
Omsk, Russia
March - April 2015
240,000t/yr
All
Maintenance
Gazpromneft/Rosneft
Yaroslavl, Russia
March - April 2015
250,000 t/yr
All
Maintenance
SK Lubricants
Ulsan, South Korea
March 2015 for 4 weeks
38,500 b/d
All
Maintenance
SK Lubricants
Ulsan, South Korea
March 2015 for 4 weeks
10,000 b/d
All
Maintenance
Formosa
Mailiao, Taiwan
March 2015 for 40 days
520,000 t/yr
NA
Maintenance
Calumet
Princeton, Louisiana, US
1Q 2015
6,900 b/d
All
Maintenance
San Joaquin Ref
Bakersfield, California, US
2H Feb 2015
8,100 b/d
All
Maintenance
Motiva
Port Arthur, US
2015
2,050,000 t/yr NA
Maintenance
HollyFrontier
Tulsa, Oklahoma, US
End 2014
9,500 b/d
NA
Maintenance
Petrochina
Fushun, China
From Dec 2014
150,000 t/yr
All
Maintenance/run-cuts
Sinopec
Jinan, China
Dec 2014 for 1-2 months
150,000 t/yr
All
Maintenance
Rosneft
Angarsk, Russia
From early Dec 2014
250,000 t/yr
NA
Lower run-rates
Lukoil
Nizhniy Novgorod, Russia
Nov 2014
290,000 t/yr
NA
Lower run-rates
Lukoil
Perm, Russia
Nov 2014
460,000 t/yr
NA
Lower run-rates
Lukoil
Volgograd, Russia
Nov 2014
715,000 t/yr
NA
Lower run-rates
Cepsa
San Roque/ Algeceiras, Spain Nov 2014 for 3 weeks
265,000 t/yr
All
Maintenance
Sinopec
Jingmen, China
15 Nov 2014 for 1-2 months
300,000 t/yr
100,000t/yr
Maintenance
Sinopec
Yanshan, China
Early-Nov to mid-Nov 2014
250,000t/yr
All
APEC Meeting
ExxonMobil
Singapore
6 Oct 2014 for 1-2 months
1,275,000 t/yr NA
Maintenance
CNOOC
Huizhou, China
6 Oct-20 Dec 2014
400,000 t/yr
All
Maintenance
Lyondell Basell
Houston, Texas, US
Early-Oct to early-Nov 2014
3,600 b/d
All
Maintenance
CPC-Shell
Kaohsiung, Taiwan
30 Sep 2014
280,000 t/yr
All
Closure
Rosneft
Angarsk, Russia
7 Sep to 15 Oct 2014
250,000 t/yr
All
Maintenance
PetroChina
Karamay, China
Early-Sep to early-Oct 2014
400,000 t/yr
All
Maintenance
Pertamina
Cilacap, Indonesia
End-Sep to mid-Nov 2014
440,000t/yr
NA
Maintenance
Thai Lube
Sriracha, Thailand
End-Sep 2014 for 1 week
275,000 t/yr
NA
Maintenance
Qisheng Industrial
Shandong, China
Sep to early-Nov 2014
70,000 t/yr
All
Maintenance
Panjin Northern Asphalt Liaoning, China
Sep 2014
400,000 t/yr
Maintenance
Gazpromneft
Omsk, Russia
Sep to mid-Nov 2014
240,000 t/yr
Sinopec
Gaoqiao, China
1 Sep 2014 to 2H Nov 2014
600,000 t/yr
All
Impacts light
grades
300,000
Sinopec
Gaoqiao, China
1 Sep 2014 to early-Nov 2014
600,000 t/yr
300,000
Maintenance
Naftan
Novopolotsk, Belarus
15 Aug 2014 for 1 month
200,000 t/yr
NA
CDU shutdown
Safor
Durban, South Africa
From 31 Jul 2014
155,000t/yr
All
Closure
Sinopec
Jingmen, China
Mid-Jul to Sep 2014
300,000 t/yr
100,000t/yr
Maintenance
Petrogal
Porto, Portugal
Mid-Jul for 1 month
185,000 t/yr
NA
Maintenance
PetroChina
Daqing Petrochemical, China Jun 2014 for 20 days
450,000 t/yr
200,000t/yr
Maintenance
Excel Paralubes
Westlake, Louisiana, US
25 Jun 2014 till 1H Aug 2014
30,000 b/d
All
Maintenance
JX Nippon
Mizushima, Japan
20 May to 16 Aug 2014
225,000 t/yr
All
Maintenance
Upgrade
Maintenance
Every effort has been made to verify information directly with appropriate company sources. Some information has been obtained from usually reliable
sources, but cannot be officially confirmed with the refinery concerned. The list will be updated when new information becomes available.
Page 25 of 28
Argus Base Oils
Market Fundamentals
Sep 2014
Industrial overview
Automobile
sales
000 Mom%
China
Lube/base oils overview
Industrial
growth
Production
Yoy%
Yoy%
000t
Sales
Import
Export
Mom%
Yoy%
000t
Mom%
Yoy%
000t
Mom%
Yoy%
000t
Mom%
Yoy%
1,696
+16
+6
+8.00
467.2
-4
-11
756.2
+7
+1
274.4
+34
+28
4.1
+140
+209
Japan*
519
+56
-1
+0.80
180.0
+12
+5
114.5
+9
-5
4.4
-35
-30
56.1
+12
-9
Europe
1,236
+85
+6
+0.40
US*
1,246
-21
+9
+4.30
811.0
-6
+6
562.7
-2
+7
131.3
-27
+62
366.6
+12
+18
France
151
+80
+6
-0.10
50.7
+56
+1
Germany
260
+22
+5
+0.10
108.5
-8
+135
85.0
+19
-7
55.0
+9
+31
29.6
+25
+122
Italy
110
+108
+3
-2.90
36.0
+64
+0
Russia
197
+15
-20
+2.80
90.3
-20
-13
Spain
57
+26
+26
+1.60
33.3
+49
+7
Turkey
UK
Australia*
India
67
+11
-2
+2.50
5.3
-72
+21
43.0
-39
-39
426
+490
+6
+2.10
34.0
+2
+55
27.0
-18
-27
95
+8
+3
0.0
24.5
+2
155
+1
-1
+2.50
75.2
+4
+19
257.0
-21
Singapore
37.7
-27
-43
0.0
+3
43.4
+125
+24
48.6
+46
+51
+35
200.5
+14
+19
41.2
-31
-36
158.9
-37
-8
-1.20
South Korea
52.1
+123
+157
346.0
+24
+26
Taiwan*
35
+50
+20
+10.30
20.9^
-25
-9
9.9
-41
-4
3.6
-11
-28
39.3
-29
+129
Thailand*
69
+0
-27
-3.92
40.9
-18
-25
33.4
+13
+1
16.8
+24
-13
17.6
-41
-45
6.8
-4
+112
0.0
92.6
-13
-15
49.2
-33
-34
13.3
+346
+283
Argentina*
+1.90
60
+18
-29
-1.70
6.0
-13
-50
Brazil*
296
+9
-4
-2.10
56.8
+60
+50
Mexico*
89
-14
+14
+3.00
13.0
-23
-29
* The conversion factor used is 159 litres to a barrel and 7.1 barrels to a metric tonne.
^ Taiwan lube production plus imports
Global industrial growth

15
US
Yoy%
China
Europe
Apparent demand.
4 weeks to end-month.
Global lubricating oils demand

1,000
US
China
000 t
Germany
Brazil
800
10
600
5
400
0
-5
Apr 13
200
Oct 13
Apr 14
Oct 14
0
Apr 13
Oct 13
Apr 14
Oct 14
Sources: Country data for base oil and lube sales, production, imports and exports taken from national sources
US: Energy Information Administration. Japan: Petroleum Association of Japan. Italy: Unione Petrolifera. Singapore: International
Enterprise. Country data for industrial production growth taken from national sources. Automobile sales data taken from national
automobile associations. US: Autodata Corp. Russia: Association of European Businesses in the Russian Federation. Australia: Federal
Chamber of Automotive Industries. India: Society of Indian Automobile Manufacturers. Thailand: Toyota Motor Thailand.
Page 26 of 28
Argus Base Oils
Market Fundamentals
Upcoming / recent expansions / conversions / new plants
Refiner
Location
Timing
New capacity
683,000t/yr
Hengli Petrochemical
Dalian, China
NA
Sasol
Louisiana, US
Around 2020 NA
Grade
Expansion / new plant
Group II and III
New
GTL
New
Pemex
Salamanca, Mexico
2018
3,300 b/d
Group II
Expansion
Petrobras
Comperj, Brazil
2017
355,000 t/yr
Group II
New
Group III
Neste
NA
By 2017
200,000 t/yr
Holly Frontier
Wood Cross, US
2018
10,000-12,000 b/d Group III
Expansion
New
Hainan Handi
Hainan, China
End 2016
1.2mn t/yr
Group III
New
Luberef
Yanbu, Saudi Arabia
1Q 2016
715,000 t/yr
Group II
New
VN Oil
Hiep Phuoc, Vietnam
Mar 2015
50,000 t/yr
Group II re-refinery
New
ExxonMobil
Singapore
1Q 2015
NA
Group II
Expansion
ExxonMobil
Baytown, US
1Q 2015
NA
Group II
Expansion
CNOOC
Taizhou, China
End-2015
600,000 t/yr
Group II
New
Panjin Northern Asphalt
Liaoning, China
2015
300,000 t/yr
New
Jinling Petrochemical
Nanjing, China
2015
200,000 t/yr
Group II
New
NIS, Serbia
Serbia
2015
180,000 t/yr
Group II/ naphthenic
New
Nynas
Harburg, Germany
2015
NA
350,000 t/yr naphthenic base oils
Conversion/expansion
Sinopec
Maoming, China
Mid-2015
250,000 t/yr
Group II
Expansion
Sinopec
Yanshan, China
2015
240,000 t/yr
Group II
Expansion
Adnoc
Abu Dhabi, UAE
1Q 2015
620,000 t/yr
500,000 t/yr Group III, 120,000 t/yr Group II
New
Tatneft
Nizhnekamsk, Russia
Dec 2014
186,000t /yr
Group II/III
New
630,000 t/yr
SK Lubricants/Repsol
Cartagena, Spain
20 Sep 2014
Shell/Hyundai Oilbank
Daesan, South Korea
Aug-Sep 2014 650,000 t/yr
Group III 3-8cst
New
Group II
New
Hengrunde Petrochemical Shandong,China
Aug 2014
200,000 t/yr
Group II
New
Heritage-Crystal Clean
Indiana, US
Mid-2014
25mn USG/yr
Re-refined Group II light and mid-grade
Expansion
Naftan
72,000 t/yr
Group I
Conversion
Chevron
Pascagoula, US
1.25mn t/yr
Group II
New
100mn l/yr
NA
New
200,000 t/yr
Group III
Expansion
Southern Oil
Queensland, Australia
May 2014
July-Aug
2014
Mar 2014
Modrica refinery
Modrica, Bosnia
2014
Puralube
Hebei Feitian Petrochemical
Panjin Northern Asphalt
Troeglitz, Germany
2014
50,000 t/yr
Group II
New
Hebei, China
Q4 2013
100,000 t/yr
Group II
New
Liaoning, China
Oct 2013
400,000 t/yr
Group II
Expansion
S-Oil
Onsan, South Korea
Oct 2013
3,000 b/d
Group III
Expansion
SK Lubricants
Ulsan, South Korea
Jun 2013
Avista Oil (US)
Peachtree, Georgia, US May 2013
11,000 b/d
Group II heavy-grade, from Group III
Conversion
1,000 b/d
Group II
New
Lwart
Lencois Paulista, Brazil Jan 2013
150,000 t/yr
Group II re-refinery
New
Naftan
NA
Add 6,000 t/month Group III
Conversion
Nov 2012
Sinopec
Jinan, China
4Q 2012
50,000 t/yr
Group II and BS, from 100,000 t/yr Group I
SK Lubricants/JX Energy
Ulsan, South Korea
May 2012
26,000 b/d
Group III
New
Heritage-Crystal Clean
Indiana, US
1Q 2012
30mn USG/yr
Re-refined Group II light grade
New
Lotos
Gdansk, Poland
2H 2012
NA
Add Group II
Conversion
PetroChina
Fushun, China
3Q 2011
NA
Only heavy-grade Group I
Conversion
GS Caltex
Yeosu, S. Korea
Jun 2011
3,000 b/d
Heavy-grade Group II
Expansion
CNOOC
Huizhou, China
May 2011
400,000 t/yr
Group II
New
Bapco-Neste
Sitra, Bahrain
2H 2011
400,000 t/yr
Group III
New
HPCL
Mumbai, India
2H 2011
30,000 t/yr
Group II and Group III, from Group I
Shell/Qatar Petroleum
Qatar
2H 2011
1.5mn t/yr
GTL
New
Sinopec
Shanghai, China
2Q 2011
NA
Add 2,000 t/month Group III
Conversion
Hainan Handi
Hainan, China
1H 2011
70,000 t/yr
Group II, from 230,000 t/yr Group I
Every effort has been made to verify information directly with appropriate company sources. The list will be updated when new information becomes available.
Page 27 of 28
Argus Base Oils
about argus base oils

Global base oils expertise
Argus has been assessing daily global refined product prices
since 1986. These prices appear in the Argus European
Products, Argus Asia-Pacific Products, and Argus US
Products reports. We have now introduced base oil prices,
market commentary and news in the Argus Base Oils report
in response to customer requests.
Base oils trade as a single global market. But the market
is also fractured by localised logistical constraints that
affect prices and need careful supply chain management.
In Argus Base Oils, we provide prices, news, and analysis of
the spot markets and the global and local issues affecting
those markets.
Argus has a dedicated base oils reporter in each region,
in London, Singapore, Beijing, Dubai, Moscow and Houston.
These reporters are backed up by a team of over 25 refined
products markets reporters.
Argus is headquartered in London, and has offices in
Moscow, Washington, Houston, Singapore, Tokyo, Beijing,
New York, Kiev, Sydney, Astana, Johannesburg and Dubai as
well as employees in other key locations including Germany,
France, Nigeria, South Africa, Venezuela, Argentina and
Chile. Argus is a UK-registered company, owned by its
employees and the family of its founder.
Transparent methodology
A full description of our methodology is available on our
website at www.argusmedia.com. You will also find our
journalistic ethics policy, a history of Argus, and other
useful reference material.
Argus prices in indexation

Argus assesses global prices in petroleum, electricity,
natural gas, coal, emissions and transportation markets. We
use precise and transparent methodologies to assess prices,
and many Argus assessments are used as a reference price
by major market participants in spot deals, term contracts,
swaps, transfer pricing and mark-to-market.
Argus also publishes a broad range of business
intelligence reports on the energy, transportation and
emissions markets which contain exclusive news, data, and
expert analysis of industry developments and trends.
The price data included in this report is available as a
feed into your companys systems, supplied either directly
from Argus or from several data aggregators that serve
the industry. Argus offers various tools on its website for
receiving this report and the price data included in it.
Argus Base Oils forward prices methodology
Argus assesses forward base oils prices by applying the
intermonth premiums or discounts of the 30-day average of
each forward month for gasoil or heating oil futures to the
fob Asia / European export / US SN 500 physical base oil
price as published in Argus Base Oils every week.
Argus Base Oils forward premium methodology
Argus assesses the forward base oil premium to gasoil or
heating oil by comparing the physical fob Asia / European
export / US SN 500 base oils price published in Argus Base
Oils each week with the 30-day average of each forward
month for gasoil or heating oil futures. Further details are
available at www.argusmedia.com.
Argus Base Oils is published by Argus Media Ltd.

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Base oil market prices, news and analysis

India and UAE

Copyright 2015 Argus Media Ltd

Russia and FSU

Crude oil and gasoil futures

Argus Base Oils

Issue 15-02 Friday 16 January 2015

Argus market map

fob Baltic Sea

fob European export

N150 fca ARA

N600 fca ARA

fob Black Sea

cfr UAE (LVI)

Freight rates (US) *

Arbitrage opportunities - Group I

This week Prior week

This week Prior week

US Gulf coast-Far East

Europe export-UAE (LVI)

* rates for November 2014, provided by SPI Marine (www.spimarineusa.com)

Europe export-US domestic

Freight rates (Asia-Pacific) *

Mideast Gulf-WC India

Black Sea-India (LVI)

Baltic Sea-domestic NWE

Arbitrage opportunities - Group II

This week Prior week

This week Prior week

Mideast Gulf-central China

South Korea-US Gulf coast

South Korea-WC India

South Korea-central China

* rates based on one port loading/one port discharge

Copyright 2015 Argus Media Ltd

Argus Base Oils

Issue 15-02 Friday 16 January 2015

Copyright 2015 Argus Media Ltd

below the price level at which they bought the supplies

US domestic base oils premium to VGO 2%

Argus Base Oils

Issue 15-02 Friday 16 January 2015

Copyright 2015 Argus Media Ltd

SN 150 ex-tank Singapore

SN 500 ex-tank Singapore

SN 150 fob Asia

SN 500 fob Asia

Bright stock fob Asia

Bright stock ex-tank Singapore

N150 ex-tank Singapore

N500 ex-tank Singapore

N150 fob Asia

N500 fob Asia

Ex-tank Singapore reference prices

Dubai crude front month

SN 500 premium to Dubai crude

Singapore 0.05% gasoil

Gasoil premium to Dubai crude

SN 500 premium to gasoil

Asia SN 500 forward prices

Asia SN 500 forward premium to gasoil

Argus Base Oils

Issue 15-02 Friday 16 January 2015

Argus market map

US domestic base oils premium to VGO 2%

Fob Asia Group I vs Group II

South Korean exports to China / Chinese imports 000 t

Chinese / Indian base oil imports