Lubes

• Asia base oil prices and trading patterns remain volatile due to the ongoing and unresolved conflict between the United States and Iran. • Market turmoil is being driven primarily by Iran's control and closure of the Strait of Hormuz, which has severely disrupted global oil flows. • These geopolitical tensions are creating significant instability in both the crude oil and base oil sectors, impacting pricing strategies.

• Motiva, SK Enmove, and Avista Oil have announced increases in posted base oil prices. • The price hikes are driven by recent spikes in crude oil costs and tight global availability of Group II+ and Group III base oils. • In a strategic shift, SK and Chevron have entered into new supply agreements with HF Sinclair.

• Escalating hostilities between the United States and Iran, alongside the renewed closure of the Strait of Hormuz, have disrupted the flow of crude oil and refined products from the Persian Gulf. • These geopolitical tensions have pushed base oil and energy prices to steeper levels due to supply chain instability. • The situation is expected to worsen as Iran-backed Houthi rebels in Yemen threaten to attack shipping companies loading cargoes at Saudi ports on the Red Sea.