In April, we published Understanding the Oil Market Disconnect to explain why lubricant prices were rising while oil market headlines fluctuated. Since then, Chevron, ExxonMobil, and the independent price-reporting agency ICIS have published their own assessments of the market. Their data confirms what we described in April and adds something valuable: hard numbers. May brought continued price increases across every input that goes into a finished lubricant. It also brought the clearest picture yet of where this market is headed, and why a strong supplier relationship matters more right now than it has in decades.
Group III Spot Price Increase, Year to Date
+251%
ICIS U.S. Gulf Coast spot assessments through June 9. Group III is the base oil behind most full synthetic motor oils, and it remains the tightest grade in the market.
WTI Crude — May Average vs. February
+53%
Per Chevron's June market review. Crude feedstock is the single largest cost input for base oil production, and it has held near record levels since the conflict began.
Rounds of Finished Lubricant Increases Announced
3rd
ExxonMobil's May update confirmed a third round of finished-product price increases, with cost pressure now extending into additives, packaging, and freight.
1 What the Majors Are Reporting
Chevron's June market review attributes rising finished-lubricant costs to a sharp, structural disruption in global base oil and crude markets driven by the closure of the Strait of Hormuz. By Chevron's accounting, oil prices surged roughly 65% during the disruption, global oil supply fell by 10.1 million barrels per day in March, and rerouted shipping added 10 to 14 days to key trade lanes while pushing freight and war-risk insurance premiums higher. Group II postings on the U.S. Gulf Coast rose as much as 47% from February to May, while Group II and Group III spot prices ran far ahead of postings, reflecting acute scarcity.
ExxonMobil's May update reports the same trend from a different angle: broad-based cost escalation across the entire supply chain. With Hormuz still largely closed to tanker traffic, WTI July futures settled at $104.15 per barrel on May 19. The diesel premium over crude widened to roughly $60 per barrel, nearly triple its pre-conflict level, which gives refineries a strong incentive to divert feedstock into fuels and away from base oil production. That tightens base oil supply even at undamaged facilities. ExxonMobil also flags rising costs in additives, resins, steel packaging, and freight, and notes that a third round of finished-product increases has been announced.
Both companies measure the market differently. Chevron tracks percentage moves in spot pricing; ExxonMobil works from posted prices per barrel. The numbers differ slightly, but they tell the same story: prices continue to rise, and the market continues to tighten.
What Goes Into the Cost of a Finished Lubricant
A finished lubricant is built from four cost components, nearly all of which trace back to crude oil. Base oils are the largest, typically 80–99% of the product, priced on crude feedstock costs and supply-demand balance. Additives are performance chemistries, many of them petrochemical derivatives that contain base oil themselves, so they track both markets at once. Packaging means plastics tied to petrochemical prices plus steel for drums and totes. Everything else covers freight, duties, and manufacturing. When crude and base oil move together, as they have since late February, every one of these components rises at the same time.
2 How the Disruption Is Moving Through the Market
Feb–MarConflict escalates. Gulf energy infrastructure damaged, Hormuz shipping disrupted, and a significant share of global Group III production capacity removed.
Mar–AprGroup III spot prices move sharply higher. Producers begin managing volumes through allocation programs. South Korean and other alternative supply tightens.
May–JunFirst major wave of supplier price-increase notices reaches blenders. Cumulative wholesale increases of $7.00–$8.45 per gallon on full synthetic base stocks move through the chain.
Jun–JulIncreases pass to distributors. Spot availability tightens further, and wholesale synthetic motor oil prices rise. Additional increases have already been announced for June, with more expected in July.
Jul–SepIncreases projected to reach the installed channel: quick lubes, dealerships, and independent shops. Oil-change pricing rises. Tightness may begin to show in low-viscosity full synthetics.
Aug–OctIncreases projected to reach retail shelves. Promotions decline, and occasional out-of-stocks appear on specific grades.
Q4–Q1 '27Peak supply-constraint risk. Tightness in 0W-20 and other low-viscosity synthetics becomes most visible. Substitution pressure rises.
2027–28New domestic Group III capacity may begin coming online, including ExxonMobil's planned expansion. Gradual normalization becomes possible.
Projected milestones are from Petroleum Trends International. Later entries are analytical projections, not guarantees, and depend on how the conflict and shipping routes evolve.
3 The Price Picture, Grade by Grade
The clearest measure of what happened comes from ICIS, the independent price-reporting agency whose U.S. Gulf Coast assessments are the industry's benchmark. Base oil prices held essentially flat through 2025 and the first two months of 2026. Beginning in March, they moved sharply higher. The table below shows the cumulative increase for each grade from the first assessment of 2026 (January 6) through the most recent available data.
| Base Oil Grade | Latest Assessment | Increase, YTD 2026 |
|---|
| Group I — Posted Price, FOB U.S. Gulf |
| 300/350 Neutral | May 20, 2026 | +73.3% |
| Brightstock | May 20, 2026 | +50.6% |
| Group II — Posted Price, FOB U.S. Gulf |
| GC 70 | May 20, 2026 | +47.0% |
| GC 100 | May 20, 2026 | +40.0% |
| GC 600/650 | May 20, 2026 | +38.7% |
| Group III — Spot Assessment (Mid), FOB U.S. Gulf |
| 4cSt | June 9, 2026 | +222.6% |
| 6cSt | June 9, 2026 | +251.0% |
| 8cSt | June 9, 2026 | +251.0% |
Source: ICIS Dashboard Price History, Base Oils FOB USG, data through June 10, 2026. Group I and II are weekly posted prices, last updated May 20. Group III is a weekly spot assessment extending through June 9. Across all eight grades, the average year-to-date increase is approximately 96.6%, driven heavily by the Group III spot market.
Why Group III Matters So Much
Group III base oil is the foundation of most full synthetic motor oil sold in the U.S., including 0W-20, the single largest viscosity grade in the passenger car market, covering roughly a third of all U.S. passenger car motor oil by Petroleum Trends' estimate. A large share of global Group III supply came from Qatar, the UAE, and Bahrain, the production hit hardest by the conflict. The effects extend beyond passenger car oils into automatic transmission fluids, some heavy-duty engine oils, and the European OEM-approved grades (5W-30, 0W-30, 0W-40, 5W-40). When the tightest grade is also the most widely required one, the pressure is felt across the entire market.
4 Beyond Base Oil: Four More Costs Rising at Once
Additive Chemistry
Additive packages typically make up 15–20% of a finished lubricant, and their costs are rising on top of, not instead of, the base oil move. Kraton announced increases of up to 25% on tall-oil-derived products in late May. Oxea raised oxo-intermediate prices effective June 1, its third increase in three months. Blenders report cumulative additive-package increases of roughly $400–$500 per metric ton across dispersants, anti-wear additives, and viscosity modifiers.
Packaging: Resin & Steel
Polypropylene resin contracts, which drive the cost of bottles and pails, have settled higher four months in a row. Steel for drums and totes is in an allocation-driven rally, with mills effectively booked through July and allocation language back in contracts for the first time since 2021. Per the April Producer Price Index, plastic resins are up 9.1% and steel mill products up 9.0% year to date.
Freight & Inflation
General freight trucking was the single fastest-moving cost line in the April PPI, up 13.4% in one month. Trucking spot rates sit near cycle highs across dry van, reefer, and flatbed. Ocean freight rose 6% in the week of May 21, with some lanes up as much as 19%. Consumer inflation hit a one-year pace of 3.8%, its highest reading since May 2023. Every gallon we deliver carries these costs.
The Diesel Effect, Intensified
We described this force in April, and May data shows it strengthening. The diesel premium over crude has roughly tripled versus pre-conflict levels, sitting near $60 per barrel. Refineries follow that incentive: they divert feedstock into diesel and away from base oil production. This means even fully operational refineries around the world are producing less base oil, adding supply pressure on top of the physical losses in the Gulf.
What Tighter Supply Actually Looks Like — and What It Doesn't
The industry currently holds three views of this market: that the warnings are overstated because shelves are still stocked, that this is purely a pricing problem, or that it is a selective tightening, with enough volume overall but not enough of the specific products newer vehicles require. That third view is becoming the consensus, and the most likely outcome is higher prices plus selective tightness concentrated in low-viscosity full synthetics. It is worth being clear about what that looks like. This is not the 1970s, and there will be no lines at the pump. Tight lubricant supply shows up as higher prices, fewer promotions, reduced product choice, and occasional out-of-stocks on specific grades. Oil changes happen only every few months, inventory sits at multiple levels of the supply chain, and substitutions are often possible. Many businesses have not felt the full effect yet because pre-disruption inventory is still working through the system. That buffer is real, but it is also temporary, and it is masking the underlying tightness. The right response is not stockpiling. It is alignment with a supplier who has the relationships and the reach to keep product flowing.
What Lyden Oil Company Is Doing to Protect You
Multiple Supply Sources
We maintain active relationships with multiple brands across many product lines. Having more than one source gives us options when any single supplier faces constraints. In a market where allocation programs are now a reality, that breadth is protecting your supply in ways a narrower distributor simply cannot match.
Transparent Pricing
Every increase we pass along reflects a documented, written cost increase from our suppliers. Some have issued multiple rounds of increases within a single month. We do not speculate on future costs or add margin on top of disruptions. We have the documentation on file and will share it on request.
Long-Term Partnership
We have operated in this region since 1919. Supply disruptions, recessions, and every kind of market turbulence are part of a 107-year business. Our job is to be your most dependable partner, especially when conditions are difficult. Your sales representative is available to discuss your account specifically.
The numbers in this update come from the largest oil companies in the world and the industry's independent price-reporting agencies. They confirm that the cost pressure on lubricants is structural and will take time to resolve. Through every market like this one over the past 107 years, the businesses that came through strongest were aligned with a supplier built for the moment. That has been our job since 1919, and it is our job now.
This update builds on our April briefing, Understanding the Oil Market Disconnect, which explains how this disruption began and why base oil and crude oil are different markets. It remains available in full.
