Group I base oils to lose market share - seller

14 October 2008 22:22  [Source: ICIS news]

SCOTTSDALE, Arizona (ICIS news)--Group I base oils will likely lose market share as demand increases for higher quality base oils, a seller said on Tuesday.

“Better quality base oils are necessary for lubricants to comply with the new standards in the industry,” the seller said.

Significant shifts in demand for lubricating base oils are expected as performance requirements of finished lubricants continue to change.

New automotive standards include ILSAC GF-5 motor oils, API CJ-4 diesel-engine oils, and DEXRON-VI transmission fluids, the seller added.

Two major Group I sellers, Citgo and Marathon, announced earlier this year they would exit the base oils business in 2008.

“The announcements from Citgo and Marathon will not be the last,” the seller added. “We are all expecting another Group I seller to shut down by the end of next year. The question is who.”

In 2003, the Group I base oils were 84% of total world base oil demand. However, Group I will just be 64% of total world base oil demand by 2015, according to the National Petrochemical & Refiners Association (NPRA).

Major US Group I sellers include ExxonMobil, Sunoco, Calumet and Valero.

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By: Heather McGuire Doyle
+1 713 525 2653

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