Base Oil Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)

The Base Oil Market Report is Segmented by Type (Group I, Group II, Group III, Group IV, and Other Types), Application (engine Oils, Transmission and Gear Oils, Metalworking Fluids, Hydraulic Fluids, Greases, and Other Applications), and Geography (Asia-Pacific, North America, Europe, South America, and Middle-East and Africa). The Report Offers Market Size and Forecasts for Base Oil in Volume (liters) for all the Segments.

Base Oil Market Size

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Base Oil Market Summary
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Study Period 2019 - 2029
Market Volume (2024) 41.26 Billion liters
Market Volume (2029) 47.98 Billion liters
CAGR (2024 - 2029) 3.06 %
Fastest Growing Market Asia Pacific
Largest Market Asia Pacific

Major Players

Base Oil Market Major Players

*Disclaimer: Major Players sorted in no particular order

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Base Oil Market Analysis

The Base Oil Market size is estimated at 41.26 Billion liters in 2024, and is expected to reach 47.98 Billion liters by 2029, growing at a CAGR of 3.06% during the forecast period (2024-2029).

The demand for base oil decreased significantly in 2020 due to the outbreak of COVID-19. The virus caused production to decline in the automotive industry and various other industrial units (aviation, industrial, etc.) because of the reduction in the consumption of engine oil, gear oil, greases, and metalworking fluid. However, in 2021 and 2022, the base oil market recovered as car manufacturing and production activities across other industries ramped up.

  • Over the short term, the primary factor to drive the market's growth is rapid industrialization in developing nations, considering the industrial application of base oil such as hydraulic fluid and industrial gear oil.
  • On the flip side, fluctuations in crude oil prices and declining demand for Group I Base oils will likely hamper the market's growth over the forecast period.
  • Nevertheless, innovation in recycling base oils will likely provide opportunities for the market studied during the forecast period.
  • The Asia-Pacific region is expected to dominate the market and will also witness the highest CAGR during the forecast period. It is owing to significant demand from countries such as China, India, and Japan.

Base Oil Market Trends

Engine Oil Segment to Dominate the Market Demand

  • The engine oil segment dominates the demand for base oil due to the growing demand for engine oil from automotive, power, heavy equipment, metalworking, chemicals, and others.
  • Engine oils are widely used to lubricate internal combustion engines and comprise 75-90% base oils and 10-25% additives.
  • They are typically used for wear reduction, corrosion protection, and smooth operation of the engine internals. They create a thin film between the moving parts to enhance heat transfer and reduce tension during the contact of parts.
  • According to OICA data, the global production of motor vehicles in 2022 recorded 85,016,728 units. It registered an increase of around 6% compared to total motor vehicle production in 2021. This growth also propelled the base oil demand worldwide.
  • According to OICA, global car sales grew to around 57.49 million automobiles in 2022, up from around 56.44 million units in 2021. Such growth in car sales will significantly benefit the base oil market during the forecast period.
  • India is among the fastest-growing markets for motor vehicles. According to the Society of Indian Automobile Manufacturers (SIAM), automobile sales volume in India expanded by 20.36% in 2023 over the previous year. The demand for automobiles across regions is expected to increase year-on-year because of the increasing demand for personal transport among individuals.
  • As a result, the above factors are anticipated to substantially influence the engine oil market in the future years.
Base Oil Market : Motor Vehicle Production, In million units, Global, 2019 - 2022

Asia-Pacific Region to Dominate the Market

  • The Asia-Pacific region controlled most of the worldwide market share, with rising investments in the automobile sector in Malaysia, India, and Thailand. For instance, MG, a British brand owned by China's SAIC Motors and created in partnership with Thailand's Charoen Pokphand Group, is targeting Thailand with its first-ever pickup truck, the "Extender." It is expected to boost engine oil consumption in the area over the projection period.
  • According to the China Association of Automobile Manufacturers, with 30.09 million units sold in 2023, China maintained its position as the world's largest automobile seller. This number also included overseas shipments, which grew by 58% to about 4.91 million units.
  • As per the Japan Automobile Manufacturers Association (JAMA), in the half-yearly period in 2022, Japanese automotive manufacturers manufactured 4,917,289 vehicles. It was an increase of 35% compared to the same period in the year 2021.
  • According to the Organisation Internationale des Constructeurs d'Automobiles (OICA), motor vehicle production in 2022 in the Asia-Pacific reached about 7% higher volume compared to 2021.
  • Moreover, Asia-Pacific is the leading producer of automotives globally. For instance, according to the Organisation Internationale des Constructeurs d'Automobiles (OICA), China, India, Japan, and South Korea were among the top 5 countries in terms of car production volume in 2022.
  • The automobile market in the Asia-Pacific is estimated to make significant growth during the forecast period because of the estimated growth in demand for motor vehicles driven by rising disposable income, government incentives encouraging people to buy electric and hybrid vehicles, changing life patterns, and other supporting factors.
  • As a result, the factors above are projected to substantially influence the base oil market in the Asia-Pacific region during the forecast period.
Base Oil Market - Growth Rate by Region

Base Oil Industry Overview

The base oil market is fragmented, where numerous players hold insignificant shares to affect the market dynamics individually. Some of the major players in the market (not in any particular order) include Exxon Mobil Corporation, Shell plc, China Petrochemical Corporation, Evonik Industries AG, and Chevron Corporation, among others.

Base Oil Market Leaders

  1. Exxon Mobil Corporation

  2. Shell plc

  3. China Petrochemical Corporation

  4. Evonik Industries AG

  5. Chevron Corporation

*Disclaimer: Major Players sorted in no particular order

Base Oil Market Concentration
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Base Oil Market News

  • Sep 2023: PETRONAS Lubricants International (PLI) and PT Kilang Pertamina Internasional (PT KPI) signed a Joint Study Agreement (JSA) to explore the possibility of developing a new greenfield lube base oil plant in Refinery Unit (RU) IV Cilacap, Central Java.
  • Jul 2023: Chevron Corporation began making four centiStoke API Group III base stocks at its refinery in Richmond, California. The change will boost the United States output of Group III stocks. It will help accommodate rising demand for the category while reducing dependence on imports.
  • September 2022: Indian Oil Corporation Limited (IOCL) granted an engineering, procurement, and construction contract to ThyssenKrupp Industrial Solutions India Private Ltd. for USD 75 million with a capacity of 270 kilotons per annum (KTPA). Catalytic Dewaxing Unit (CDWU) is used for the production of lube base oils at its refinery located in Gujarat, India.
  • April 2022: Chevron Global Energy Inc., a subsidiary of Chevron Corporation, acquired the NEXBASE brand of Neste Corporation. This acquisition will strengthen the company's position as a leading supplier of base oils worldwide.

Base Oil Market Report - Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Drivers

      1. 4.1.1 Rapid Industrialization in Developing Nations

      2. 4.1.2 Other Drivers

    2. 4.2 Restraints

      1. 4.2.1 Fluctuations in Crude Oil Prices

      2. 4.2.2 Declining Demand for Group I Base Oils

    3. 4.3 Industry Value Chain Analysis

    4. 4.4 Porter's Five Forces Analysis

      1. 4.4.1 Bargaining Power of Suppliers

      2. 4.4.2 Bargaining Power of Consumers

      3. 4.4.3 Threat of New Entrants

      4. 4.4.4 Threat of Substitute Products and Services

      5. 4.4.5 Degree of Competition

  5. 5. MARKET SEGMENTATION (Market Size in Volume)

    1. 5.1 Type

      1. 5.1.1 Group I

      2. 5.1.2 Group II

      3. 5.1.3 Group III

      4. 5.1.4 Group IV

      5. 5.1.5 Other Types

    2. 5.2 Application

      1. 5.2.1 Engine Oils

      2. 5.2.2 Transmission and Gear Oils

      3. 5.2.3 Metalworking Fluids

      4. 5.2.4 Hydraulic Fluids

      5. 5.2.5 Greases

      6. 5.2.6 Other Applications

    3. 5.3 Geography

      1. 5.3.1 Asia-Pacific

        1. 5.3.1.1 China

        2. 5.3.1.2 India

        3. 5.3.1.3 Japan

        4. 5.3.1.4 South Korea

        5. 5.3.1.5 Malayisa

        6. 5.3.1.6 Indonesia

        7. 5.3.1.7 Vietnam

        8. 5.3.1.8 Thailand

        9. 5.3.1.9 Rest of Asia-Pacific

      2. 5.3.2 North America

        1. 5.3.2.1 United States

        2. 5.3.2.2 Canada

        3. 5.3.2.3 Mexico

      3. 5.3.3 Europe

        1. 5.3.3.1 Germany

        2. 5.3.3.2 United Kingdom

        3. 5.3.3.3 France

        4. 5.3.3.4 Italy

        5. 5.3.3.5 NORDIC

        6. 5.3.3.6 Russia

        7. 5.3.3.7 Spain

        8. 5.3.3.8 Turkey

        9. 5.3.3.9 Rest of Europe

      4. 5.3.4 South America

        1. 5.3.4.1 Brazil

        2. 5.3.4.2 Argentina

        3. 5.3.4.3 Colombia

        4. 5.3.4.4 Rest of South America

      5. 5.3.5 Middle-East and Africa

        1. 5.3.5.1 Saudi Arabia

        2. 5.3.5.2 South Africa

        3. 5.3.5.3 United Arab Emirates

        4. 5.3.5.4 Egypt

        5. 5.3.5.5 Qatar

        6. 5.3.5.6 Nigeria

        7. 5.3.5.7 Rest of Middle-East and Africa

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Mergers and Acquisitions, Joint Ventures, Collaborations, and Agreements

    2. 6.2 Market Share (%)**/Ranking Analysis

    3. 6.3 Strategies Adopted by Leading Players

    4. 6.4 Company Profiles

      1. 6.4.1 ADNOC (Abu Dhabi National Oil Company)

      2. 6.4.2 Chevron Corporation

      3. 6.4.3 China Petrochemical Corporation (SINOPEC)

      4. 6.4.4 CNOOC Limited

      5. 6.4.5 Evonik Industries AG

      6. 6.4.6 Exxon Mobil Corporation

      7. 6.4.7 Formosa Petrochemical Corporation

      8. 6.4.8 Gazprom Neft PJSC

      9. 6.4.9 GP Global

      10. 6.4.10 GS Caltex Corporation

      11. 6.4.11 Indian Oil Corporation Ltd

      12. 6.4.12 LUKOIL

      13. 6.4.13 NESTE

      14. 6.4.14 Nynas AB

      15. 6.4.15 Petrobras

      16. 6.4.16 PETRONAS Lubricants International

      17. 6.4.17 Philips 66 Company

      18. 6.4.18 Repsol

      19. 6.4.19 Saudi Arabian Oil Co.

      20. 6.4.20 Sepahan Oil

      21. 6.4.21 Shell Plc

      22. 6.4.22 SK Innovation Co., Ltd.

      23. 6.4.23 S-OIL CORPORATION

      24. 6.4.24 Total Energies

    5. *List Not Exhaustive
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

    1. 7.1 Innovation in the Field of Renewable Base Oils

    2. 7.2 Other Opportunities

**Subject to Availability
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Base Oil Industry Segmentation

Base oils are one of the specialty products that a refinery can produce and are not considered as fuel. Base oils are categorized into five groups, i.e., Group I-V. The first three groups are derived from downstream petroleum refinery plants. Group IV base oils are synthetic (polyalphaolefins) oils. The base oil market is segmented by type, application, and geography.

The market is segmented by Group I, Group II, Group III, Group IV, and other types (Group V). By application, the market is segmented into engine oils, transmission and gear oils, metalworking fluids, hydraulic fluids, greases, and other applications (process oils and general industrial lubricants). The report also covers the market size and forecasts for the base oil market in 27 countries across major regions. For each segment, the market sizing and forecasts are done based on volume (liters).

Type
Group I
Group II
Group III
Group IV
Other Types
Application
Engine Oils
Transmission and Gear Oils
Metalworking Fluids
Hydraulic Fluids
Greases
Other Applications
Geography
Asia-Pacific
China
India
Japan
South Korea
Malayisa
Indonesia
Vietnam
Thailand
Rest of Asia-Pacific
North America
United States
Canada
Mexico
Europe
Germany
United Kingdom
France
Italy
NORDIC
Russia
Spain
Turkey
Rest of Europe
South America
Brazil
Argentina
Colombia
Rest of South America
Middle-East and Africa
Saudi Arabia
South Africa
United Arab Emirates
Egypt
Qatar
Nigeria
Rest of Middle-East and Africa
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Base Oil Market Research FAQs

The Base Oil Market size is expected to reach 41.26 billion liters in 2024 and grow at a CAGR of 3.06% to reach 47.98 billion liters by 2029.

In 2024, the Base Oil Market size is expected to reach 41.26 billion liters.

Exxon Mobil Corporation, Shell plc, China Petrochemical Corporation, Evonik Industries AG and Chevron Corporation are the major companies operating in the Base Oil Market.

Asia Pacific is estimated to grow at the highest CAGR over the forecast period (2024-2029).

In 2024, the Asia Pacific accounts for the largest market share in Base Oil Market.

In 2023, the Base Oil Market size was estimated at 40.00 billion liters. The report covers the Base Oil Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the Base Oil Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.

The major application segments of the Base Oil Market are a) Engine Oils b) Transmission and Gear Oils c) Metalworking Fluids d) Hydraulic Fluids and Greases

Base Oil Industry Report

The global base oil market is experiencing significant growth, driven by the increasing demand for high-grade oils in the automotive industry and rapid industrialization in developing nations. Segmented based on product types, including Group I, Group II, and Group III base oils, Group II oils are gaining popularity due to their high performance and affordability. The Dominating market is the automotive oils application segment, fueled by the rising production of motor vehicles and the growing automotive sector in regions like Asia Pacific. The market is influenced by trends such as the shift towards electric vehicles, impacting the demand for certain lubricants. Despite challenges like fluctuating crude oil prices and declining demand for Group I base oils, opportunities arise from innovations in recycling base oils and the lucrative markets in BRIC countries. Base oil suppliers are highly competitive, focusing on expanding production capacities and introducing innovative products to meet the evolving needs of various industries, including automotive, industrial, and manufacturing sectors. Statistics for the Base Oil market share, size, and revenue growth rate are provided by Mordor Intelligenceā„¢ Industry Reports, which include a market forecast outlook and historical overview of this industry analysis is available as a free report PDF download.

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Base Oil Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)