Lubricants Market Morning Report 20260605

I. Global Market Updates

The EIA keeps its 2026 Brent crude price forecast at $95 per barrel, with uncertainties over demand growth.

In its latest monthly report, the EIA maintained the average Brent crude price projection at $95/barrel for 2026, after two previous downward revisions, reflecting concerns over slowing global demand. Global oil demand growth is expected to moderate in 2026, while the Asian market will remain a major driving force.

Continued planned output hikes by OPEC+ weigh on international crude prices.

OPEC+ proceeds with its moderate production increase plan, stoking market worries about supply surplus. Coupled with robust U.S. shale oil output, international crude prices face short-term downward pressure.

Tensions persist across the Strait of Hormuz, keeping geopolitical risk premiums intact.

Despite progress in U.S.-Iran talks, nuclear negotiations move slowly. The risk premium for shipping through the Strait of Hormuz continues to underpin crude prices. Regional tensions are set to remain a key factor triggering price volatility in the near term.

WTI and Brent crude extended losses on June 4, both down over 1%.

WTI crude closed at $94.86 per barrel on June 4, down 1.22%; Brent crude settled at $95.99 per barrel, down 1.90%. International crude prices fell for the second consecutive day, dragged by bearish market sentiment and expectations of inventory builds.

JKM LNG benchmark in Northeast Asia edged up amid rising summer power demand.

Spot LNG prices in Asia saw a mild uptick as Japan and South Korea ramp up procurement for summer power generation, leading to a month-on-month demand improvement. Nevertheless, high overall inventories limit price gains, and JKM prices are expected to move sideways in the short run.

II. Lubricant Industry News

Domestic base oil prices dipped slightly; the mainstream price of 150N base oil in East China stands at RMB 9,600-9,800 per ton.

Data from Longzhong Information dated June 2: The prevailing transaction price of 60N base oil in East China is RMB 8,010 per ton, and 150N base oil is quoted at RMB 9,610-9,852 per ton. 150N base oil in South China is around RMB 10,450 per ton. Imported Group II 150N base oil is referenced at RMB 16,800 per ton in East China amid tight supply.

Lubricant enterprises accelerate layout in data center liquid cooling and robotics sectors.

According to Lubricant Information Network, the coolant market has emerged as a new growth area. Leading brands including Kunlun, Fuchs and Castrol have stepped into the data center liquid cooling track. Lubricating greases for robot joints have also become a key area for technological differentiation and competition.

Inter Lubric China 2026 kicks off in Shanghai on June 9, featuring a full lineup of concurrent forums.

The 16th China International Lubricants Industry Development Summit was held on June 7-8 in advance. Industry giants such as ExxonMobil, Shell and Castrol conducted in-depth discussions on PAO technology and automotive fluid solutions.

III. South American Market

Petrobras expands output at Buzios Oilfield, driving higher crude exports from Latin America to Asia.

Petrobras further strengthens its presence in the Asian market. Steady production growth at the high-yield pre-salt Buzios Oilfield has pushed Brazil’s crude exports to a record high, making Brazil an important diversified supply source for Asian refineries.

Venezuela’s crude exports hampered by sanctions; India shifts purchases to Angola to fill the gap.

U.S. sanctions on Venezuela remain in place. India and other buyers have diverted part of their crude procurement to West African producers including Angola and Nigeria, lifting West African crude’s share in India’s imports.

IV. African Market

Angola and Nigeria become preferred suppliers for Indian refineries with surging crude exports to Asia.

Beyond Russian crude, Indian refiners have increased purchases from Africa. Crude shipments from Angola and Nigeria to India have risen notably, making West Africa a vital supplement for India’s import diversification strategy.

Nigeria’s crude output recovery stalled by supply chain bottlenecks.

Outdated oilfield infrastructure and security issues continue to disrupt Nigeria’s crude production, keeping output below its OPEC+ quota. Even so, Forcados and Bonny crude remain major West African varieties exported to Asia.

V. Russian Market

Urals crude trades at a steep discount, with Asia accounting for over 70% of exports.

Following the Russia-Ukraine conflict, Russia’s crude exports to non-European destinations have exceeded 73%. Urals crude maintains a substantial discount against Brent crude, attracting large-scale purchases from China and India. Rising logistics costs, however, narrow arbitrage margins.

Refinery maintenance curbs operating rates, tightening product oil exports.

Major Russian refineries undergo scheduled maintenance from May to June, resulting in a temporary drop in diesel and fuel oil output. Robust demand from India and Southeast Asia keeps regional supply tight and supports product oil prices in Asia.

VI. South Asian Market

India’s daily Russian crude imports hit roughly 1.9 million barrels in May; import exemption extended to mid-June.

India imported around 1.9 million barrels of Russian crude per day in May, with the U.S. import exemption extended to June 17. Major refiners including Reliance keep high procurement volumes of Russian crude. Faced with policy uncertainties, Indian buyers have actively secured alternative supply sources.

Indian refineries diversify purchases to Latin America and Africa to mitigate supply risks.

Amid shipping constraints in the Strait of Hormuz, Indian refiners have increased crude imports from Brazil, Venezuela and Angola to reduce reliance on Russian crude and adopt a more flexible procurement strategy.

VII. Marine Lubricants in Malaysia

Domestic 180CST marine fuel prices expected to keep falling amid bearish crude outlook for June.

According to Zhuochuang Information, raw material prices for domestic marine fuels rose then fell in May amid sluggish end-user demand. With crude prices under downward pressure in June, raw material costs will decline, and the average price of domestic 180CST marine fuel is projected to weaken further.

Singapore VLSFO bunker price: USD 715-725 per ton; price gap with Malaysia narrows.

In early June, Singapore’s VLSFO bunker is priced at USD 715-725 per ton and MGO at USD 1,235-1,245 per ton. VLSFO prices at Port Klang in Malaysia are largely on par with Singapore, intensifying regional market competition.

VIII. Lubricant General Knowledge

Customer-oriented Popular Science

Did you know? Overfilling lubricant will damage the engine.

Many vehicle owners believe the more engine oil the better, yet excessive oil causes harm. Excess oil will be churned by the crankshaft, boosting fuel consumption and generating excessive foam. This leads to poor lubrication, abnormal oil pressure and accelerated engine wear. Always fill oil between the upper and lower marks on the oil dipstick; a slightly low oil level is safer than overfilling.

Technical Training for Sales Staff

Why is HTHS viscosity crucial?

HTHS (High Temperature High Shear) viscosity measures oil viscosity under 150°C and high shear conditions, which directly reflects oil film strength when the engine operates at high temperatures. The ACEA standard requires HTHS ≥ 3.5 mPa·s for ACEA C category oils. Insufficient HTHS will cause lubrication failure around piston rings, resulting in abnormal wear and fuel dilution. When communicating with customers, you may emphasize that HTHS is a core indicator to evaluate the high-temperature protection performance of lubricants.

IX. Technical Highlights

Suzhou Bobang’s magnetic levitation air compressor obtains ISO8573-1 Class 0 oil-free certification, delivering 20% energy savings.

Adopting non-contact magnetic bearing technology, Suzhou Bobang’s magnetic levitation air compressor achieves a transmission efficiency above 97%. It cuts overall energy consumption by around 20% compared with traditional models, reduces maintenance costs by 76% and achieves zero lubricant consumption. With motor power ranging from 55kW to 2000kW, it is widely applicable to power, steel, petrochemical, food, pharmaceutical and other industries.

Vacuum Pump Oil Selection Guide

Low vapor pressure and stable viscosity are core selection criteria.

Vacuum pump oil serves three major functions: sealing, lubrication and heat dissipation. Key selection parameters include vapor pressure, viscosity stability and chemical inertness. Molecular distillation technology improves oil purity. Improper oil selection can push equipment failure rates up by more than 25%. Perfluoropolyether (PFPE) is suitable for extreme working conditions such as the semiconductor industry, though it comes with higher costs.