C1 Methodology and Specifications Guide --- Base Oil

Base Oil
Base oil is a kind of refined oil mainly used to produce lubricating oil. It could produce all kinds of lubricating oil when mixed with additives. It usually accounts for 50%-90% of lubricating oil content, which determines key performances of the latter. There are many types of lubricating oil, which are also widely used. The most common grade is vehicle lubricating oil.

Base oil is abstracted from crude. Production procedure mainly includes: distillation under atmospheric pressure, residue solvent deasphalt, solvent refining, solvent dewaxing and clay finishing or hydro-refining. Unlike most petrochemicals, there is neither national standard nor industry standard for base oil, which explains various speculations of base oil produced by different refineries. The American Petroleum Institute (API) categorized base oil into five types, and merged the principle into its Engine Oil Licensing and Certification System.

Product Specifications

Group	Category	Sulfur Content wt%	Saturated Hydrocarbonwt%	Viscosity Index VI	Pour Point ℃
Ⅰ	Normal mineral base oils	>0.03	<90	80-120	≤-5
Ⅱ	Hydrocracked base oils	<0.03	>90	80-120	≤-5
Ⅲ	Hydrocracked base oils	<0.03	>90	>120	≤-15

C1 base oil reports cover daily intelligence on Chinese and Asian base oil markets and price assessments.

Editorial Group:
Shi Hanlei nancyshi@c1energy.biz
Ma Jun jerryma@c1energy.biz
Ma Yiqin vivienma@ c1energy.biz

Publishing Period
Weekly, each working Tuesday

Weekly Price Assessments on China’s and Asia’s Solvent Oil Markets

International Market
Group I 150SN FOB Taiwan, Southeast Asia (US$/mt)
Group II 500SN FOB Taiwan, Southeast Asia (US$/mt)
150BS FOB Taiwan, Southeast Asia (US$/mt)
Group III 70N FOB South Korea (US$/mt)
Group III 250N FOB South Korea (US$/mt)
Group I 150SN CFR China (US$/mt)
Group I 500SN CFR China (US$/mt)
150BS CFR China (US$/mt)
Group III 70N CFR China (US$/mt)
Group III 250N CFR China (US$/mt)

China Market
Group I 150SN Ex-tank prices in South China, East China, Northeast China (Yuan/mt)
Group I 400SN Ex-tank prices in South China, East China, Northeast China (Yuan/mt)
Group II 60N Ex-tank prices in South China, East China, Northeast China (Yuan/mt)
Group II 150N Ex-tank prices in South China, East China, Northeast China (Yuan/mt)
Group III 70N Ex-tank prices in South China, East China, Northeast China (Yuan/mt)
Group III 250N Ex-tank prices in South China, East China, Northeast China (Yuan/mt)
150BS Ex-tank prices in South China, East China, Northeast China (Yuan/mt)

 

Assessment Principles

Timing:
C1 price assessments reflect the most possible tradable range on solvent oil in line with C1 standard specifications for most sellers and buyers in the Chinese and Asian spot markets from the previous Wednesday up to 16:30 Beijing time on the date of publication (each working Tuesday). C1 tracks the markets continuously and assessments are based on the information provided by market players including sellers, buyers, and/or credible third parties before the close of the trading day (16:30 Beijing time each working Tuesday).

Product Specifications:
The base oils that C1 assesses for both domestic and international markets are in line with the standard specifications issued by American Petroleum Institute (API).

Delivery time:
Assessments on CFR China markets typically reflect parcels loading within 30 days out from the date of publication.
Assessments on FOB Taiwan, Southeast Asia, South Korea markets typically reflect parcels loading within 30 days out from the date of publication.
Assessments on China domestic markets typically reflect parcels loading within 5 days out from the date of publication.

Payment term: 30 days after bill of lading on Letter of Credit (international markets); prompt payment for China markets.

 

Trading volume:
International markets:
Group I base oils, CFR China and FOB Taiwan, Southeast Asia, South Korea, 1,000-5,000mt
Group III base oils, CFR China and FOB Taiwan, Southeast Asia, South Korea, 800-1,500mt
BS base oils, CFR China and FOB Taiwan, Southeast Asia, South Korea, 800-1,500mt
China domestic markets: 50-500mt

 

Delivery points:
International markets:
FOB Taiwan, Southeast Asia: include, but are not limited to major ports in Taiwan, Singapore, Thailand, Indonesia
FOB South Korea: include, but are not limited to major ports in eastern and western coasts of South Korea
CFR China: include, but are not limited to Nantong, Jiangyin, Zhangjiagang, Taicang, Guangzhou, Dongguan, Maoming, Beihai, Tianjin, Yingkou

China domestic markets:
South China ex-tank: include, but are not limited to ex-terminal truck prices in Guangzhou, Dongguan, Shenzhen, Maoming, Xiamen
East China ex-tank: include, but are not limited to ex-terminal truck prices in Nantong, Wuxi, Jiangyin, Changzhou, Suzhou, Nanjing, Zhangjiagang, Taicang, Shanghai, Ningbo
Northeast China ex-tank: include, but are not limited to ex-terminal truck prices in Dalian, Fushun, Daqing, Yingkou

General principles:
C1’s assessments primarily reflect the traded value of the market during the assessment period when there is deal done. When there is no deal, the price assessments reflect the most possible transactable value of the market, based on a wide variety of information, including bids, offers, market fundamentals and sentiment (supply/demand, feedstocks and downstream markets, related markets, etc).

C1’s assessments are based on the traded or negotiated prices for base oils in line with C1’s standard specifications in the spot market. C1 has the right not to consider deals or negotiations on base oils with non-standard specifications. C1 will not consider deals involved in its information sources of assessments, if the deal or negotiation is between contracted or affiliated enterprises.

 

Taxes

Base Oils & Lubricant Oils --- Tax Code (27101993)
	Most-Favored-Nation Import Tariffs	Import Tariffs	Export Tariffs
2009	6%	17%	0％

Value-added Tax: 17%; no tax rebates 

Updated on Mar 13, 2009