Base Oils Lube Market Size Worth USD 35.10 Billion in 2032 | Emergen Research

Vancouver, Jan. 22, 2024 (GLOBE NEWSWIRE) — The global base oils lube market size was USD 20.50 Billion in 2022 and is expected to register a rapid revenue CAGR of 5.6% during the forecast period. Rising demand for high-grade oils in the automotive industry, increasing adoption of lubricants in the automotive industry, and rapid industrialization in developing countries are key factors driving market revenue growth.

There is rising demand for high-quality oils that can withstand high temperatures as well as fast-moving parts due to technological advancements. The base oil used has a big impact on how well the finished lubricants work. Engine oils are composed of 70%–90% base oil and the remaining 10%–30% additives. In addition, rising demand for premium engine oils is another key factor driving revenue growth of the market. High-performance engine lubricants allow diesel trucks, light-duty vehicles, passenger cars, and stationary engines to withstand challenging conditions. Base oil makes up the majority of engine oils, as a result of rising demand for high-grade oils from the automotive industry.

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Base oils are used to make a wide variety of lubricants. The automotive sector is a significant lubricant end-user, which makes use of lubricants such as gearbox and engine oils, greases, and oils. Moreover, rapid expansion of the automobile industry is, particularly in developing nations, is also expected to drive market revenue growth during the forecast period. According to the International Organization of Automobile Manufacturers (OICA), total number of automobiles manufactured globally in 2021 is expected to be 80,145,988, a 3% increase over the total number of vehicles produced in 2020.

However, declining demand for group I base oil is a key factor, which could restrain market revenue growth. There is currently a strong belief that the demand for group I base oil would shrink, especially in North America & Europe. This drop is mostly the result of rising demand for higher-quality, purer base oil, since Group I base oil has more contaminants such as sulfur, nitrogen-containing chemicals, olefins, and Polycyclic Nuclear Aromatics (PCNA). In addition, fluctuations in crude oil prices is another factor, which could also restrain market revenue growth.

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Segment Insights

Type Insights:

On the basis of type, the global base oils lube market is segmented into Group I, Group II, Group II+, Group III, Group III+, Group IV (PAO), Group V (excluding naphthenic), and others. The group I segment accounted for largest revenue share in the global base oils lube market in 2022 attributed to rising use of base oils in rail, automotive, and marine lubricants due to their high viscosity index, low volatility, and lubricating qualities.  According to American Petroleum Institute (API), group I base oils include over 0.03% sulfur and less than 90.0% saturates, with a viscosity index ranging from 80 to 120. Group I products typically contain 10.0% additives and 90.0% base oil. Typically, it is composed of conventional petroleum-based materials.

Application Insights:

On the basis of application, the global base oils lube market is segmented into automotive fluids, process oils, industrial oils, metalworking fluids, hydraulic oils, and others. The automotive fluids segment is expected to account for significantly large revenue share in is the global base oils lube market during the forecast period due to rising demand for automotive lubricants such as greases, gearbox oil, engine oil, and other lubricants. Mixed, paraffin, beeswax, palm, and soy base oils are the most widely bought automobile oils in the market.

The engines of cars and trucks, which consume over 20 million tons of lubricant a year globally, are responsible for around half of all lubricant usage. It is expected that oil companies would produce base oils in response to the automotive industry, as automakers endeavor to adhere to environmental standards. In addition, rising demand for fragrance products for homes in developed countries, such as Germany, the U.S., Canada, and the UK, is also expected to drive revenue growth of this segment during the forecast period. For example, according to Organisation Internationale des Constructeurs d’Automobiles (OICA) data, the global production of automobiles in 2021 amounted to 80,145,988, indicating a 3% rise from the total cars produced in 2020.

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Regional Insights:

The Asia Pacific market accounted for largest revenue share in the global base oils lube market in 2022 due to the region’s fast industrialization and rising demand for fuels and lubricants for transportation. For example, China is the largest automobile market in the world in terms of yearly income and manufacturing output, according to the International Trade Organisation, and the country’s automobile sector has a major impact on base oil demand. Base oil and automotive lubricants have become more in demand as a result of this country’s rapid economic growth and increasing population and urbanization.

India is a significant consumer of base oil in the Asia Pacific region because of rapid growth of the automotive industry and increasing need for industrial lubricants. For example, India’s new automobile sales climbed by 26.7% from 2,435,100 in 2020 to 3,082,400 in 2021, ranking it among the major global markets with the quickest growth. In addition, presence of major producers of base oil , such as Petronas Lubricants International, Neste Oyj, and SK Lubricants, is also expected to drive market revenue growth of this region during the forecast period.

The Europe market is accounted for second-largest revenue share in the global base oils lube market in 2022.  This is due to rising demand for fuel-efficient automobiles as well as many strict laws surrounding automotive fuel policy. For instance, the European Union Automotive Fuel Policies specifies that new passenger automobiles have an average Carbon Dioxide (CO2) emission level of maximum of 130 grams per km. As a result, the market value of base oils is developing quickly due to rising demand for the creation of highly effective lubricants made from base oils.

Scope of Research

Report Details Outcome
Market Size in 2022 USD 20.50 Billion
CAGR (2023–2032) 5.6%
Revenue Forecast To 2032 USD 35.10 Billion
Base Year For Estimation 2022
Historical Data 2019–2021
Forecast Period 2023–2032
Quantitative Units Revenue in USD Billion and CAGR in % from 2022 to 2032
Report Coverage Revenue forecast, company ranking, competitive landscape, growth factors, and trends
Segments Covered Type, application, and region
Regional Scope North America, Europe, Asia Pacific, Latin America, and Middle East & Africa
Country Scope U.S., Canada, Mexico, Germany, France, UK, Italy, Spain, Benelux, Russia, Rest of Europe, China, India, Japan, South Korea, ASEAN Countries, Oceania, Rest of APAC, Brazil, Rest of LATAM, Saudi Arabia, UAE, South Africa, Turkey, and Rest of Middle East & Africa
Key Companies Profiled Repso, Neste, GS Caltex Corporation, Bharat Petroleum Corporation Limited, SK Lubricants Co., Ltd., LUKOIL, Bahrain Lube Base Oil Company, Sepahan Oil, Saudi Arabian Oil Co., BP p.l.c, Indian Oil Corporation Ltd., Shell plc., Chevron Corporation, PrtroChina Co., Ltd., and CNOOC Limited
Customization Scope 10 hours of free customization and expert consultation

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Major Companies and Competitive Landscape

The global base oils lube market is fairly fragmented with many large and medium-sized players accounting for majority of market revenue. Major players are deploying various strategies, entering into mergers & acquisitions, strategic agreements & contracts, developing, testing, and introducing more effective base oils products in the market. Some major players included in the global base oils lube market report are:

  • Repso
  • Neste
  • GS Caltex Corporation
  • Bharat Petroleum Corporation Limited
  • SK Lubricants Co., Ltd.
  • LUKOIL
  • Bahrain Lube Base Oil Company
  • Sepahan Oil
  • Saudi Arabian Oil Co.
  • BP p.l.c
  • Indian Oil Corporation Ltd.
  • Shell plc.
  • Chevron Corporation
  • PrtroChina Co., Ltd.
  • CNOOC Limited

Strategic Development

  • In July 2020, Royal Dutch Shell and Volkswagen, a German automaker, formed a strategic alliance to provide high-performance lubricants specifically for Volkswagen’s electric cars. This collaboration seeks to create lubricants resistant to the extreme pressures and temperatures found in electric powertrains, therefore increasing the longevity and efficiency of electric cars.
  • In January 2020, Nynas AB launched NYFLEX 201B and NYFLEX 2005, two highly purified process oils intended for use in sealant compositions.

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For the purpose of this report, Emergen Research has segmented the global base oils lube market on the basis of type, application, and region:

  • Type Outlook (Revenue, USD Billion; 2019-2032)
    • Group I
    • Group II
    • Group II+
    • Group III
    • Group III+
    • Group IV Polyalphaolefin (PAO)
    • Group V (excluding Naphthenic)
    • Others
  • Application Outlook (Revenue, USD Billion; 2019-2032)
    • Automotive Fluids
      1. Lubricant
      2. Gear Oil
      3. Transmission Fluid
      4. Power Steering Fluid
      5. Brake Fluid
      6. Others
    • Process Oils
      1. Rubber Process Oil
      2. Textile Process Oil
    • Industrial Oils
      1. Transformer Oil
      2. Turbine Oil
      3. Food Grade Oil
      4. Others
    • Metalworking Fluids
      1. Emulsions
      2. Neat Oils
    • Hydraulic Oils
      1. Petroleum-Based
      2. Biodegradable
    • Others
  • Regional Outlook (Revenue, USD Billion; 2019–2032)
    • North America
      1. U.S.
      2. Canada
    • Europe
      1. Germany
      2. France
      3. UK
      4. Italy
      5. Spain
      6. Benelux
      7. Russia
      8. Rest of Europe
    • Asia Pacific
      1. China
      2. Japan
      3. South Korea
      4. India
      5. ASEAN Countries
      6. Oceania
      7. Rest of APAC
    • Latin America
      1. Brazil
      2. Mexico
      3. Rest of LATAM
    • Middle East & Africa
      1. GCC Countries
      2. Israel
      3. Turkey
      4. South Africa
      5. Rest of Middle East & Africa

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