In April 2025, base oil prices in the UAE remained unchanged, as the market showed little to no change. Both Group I and Group II base oils had no price changes during the month, as the market did not see any fluctuation the whole month.
But, prices might decline in May 2025. That’s because the UK government is imposing an increased tax liability on finished lubricants—such as engine oil and hydraulic fluid—that originate from the UAE.
The tax is extremely high—almost 60%—which means it will be more challenging for UAE (Gulf Market / Middle East oil companies) companies to sell these products in the UK. Due to this, UAE lubricant companies may have excess product left over, creating a problem in controlling inventory, which could lead to lower prices.
There may be an oversupply of engine oil and hydraulic fluid in the UAE soon, which could lead to lower prices and create market competition based on lower prices. If prices for these finished products drop, then people might also buy less base oil. This could lead to a decrease in base oil prices in May 2025.
In April 2025, base oil prices in the UAE remained unchanged. But some things might change soon. For example, a company will shut down its Group I and Group II base oil plants in Yanbu, Saudi Arabia, for maintenance. Before the shutdown, they’ll sell less so they can save up extra oil.
Also, war in the Middle East—like the conflict between Israel and groups like Hezbollah and Hamas—has led to attacks on ships near a place called Bab-al-Mandeb. These problems are making the industry worry about shipping delays and oil supply issues from Saudi Arabia.
Despite fewer supplies of base oil due to refinery shutdowns in Saudi Arabia and shipping delays in the Middle East, the price of imported base oil in the UAE remained unchanged.
After Ramadan ended and the Eid al-Fitr holidays began, many countries in the Middle East experienced a decline in demand for base oil. That’s because during the holiday, people and businesses slowed down, and there wasn’t much buying or selling. So fewer lubricants were needed.
Additionally, we observe a decline in base oil prices of 5.8%. That’s the most significant price drop since 2021! Industry Analysts think OPEC+ might start producing even more oil in June, which would add to the supply and potentially drive prices even lower.
As a result, it became cheaper for Saudi Arabia to produce base oil despite tight supplies. To keep things steady, Saudi oil producers decided not to change their prices, and that’s why base oil prices in the UAE stayed the same.
Editor-at-Large
A passionate writer in the lubricant industry, Awais Iqbal has been covering oils, greases, and industrial fluids since the start of his career. At 25, he’s already written for blogs, catalogs, and brand guides across the UAE. Awais’s insights help companies connect with their audience, and his clear, helpful writing style is trusted by brands in the region.
