Nigeria Lubricants Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Nigeria Lubricants Market is segmented by Product Type (Engine Oil, Transmission and Hydraulic Fluid, Metalworking Fluid, General Industrial Oil, Gear Oil, Grease, Process Oil, and Other Product Types), End-user Industry (Power Generation, Automotive and Other Transportation, Heavy Equipment, Food and Beverage, Metallurgy and Metalworking, Chemical Manufacturing, and Other End-user Industries). The report offers market size and forecast for Nigeria Lubricants in volume (Kilo Tons) for all the above segments.

Market Snapshot

Nigeria Lubricants Market - Market Summary
Study Period: 2016 - 2026
Base Year: 2021
CAGR: 1.54 %

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Market Overview

The market for Nigeria lubricants is is expected to reach 339.52 kilo ton by 2026, registering a CAGR of 1.54% during the forecast period (2021-2026). The demand from the expanding wind energy sector and the rising demand for high-performance lubricants are the major factors driving the growth of the market studied.

  • On the flipside, increasing drain intervals in the automotive and industrial sectors, slowdown in the automotive industry, and unfavorable conditions arising due to the COVID-19 outbreak are expected to hinder the growth of the market.
  • The growth in the industrial manufacturing segment is likely to provide opportunities for the Nigeria lubricants market over the next five years.
  • Automotive and Other Transportation is the most dominating end-user industry of the market studied.

Scope of the Report

Lubricant products are made from a combination of base oils and additives. The composition of base oil in the formulation of lubricants is primarily between 75-90%. Base oils possess lubricating properties and makeup to 90% of the final lubricant product. The Nigeria lubricants market is segmented by product type and end-user industry. By product type, the market is segmented into Engine Oil, Transmission and Hydraulic Fluid, Metalworking Fluid, General Industrial Oil, Gear Oil, Grease, Process Oil, and Other Product Types. On the basis of end-user industry, the market is segmented into Power Generation, Automotive and Other Transportation, Heavy Equipment, Food and Beverage, Metallurgy and Metalworking, Chemical Manufacturing, and Other End-user Industries. For each segment, the market sizing and forecasts have been done on the basis of volume (kiloton).

Product Type
Engine Oil
Transmission and Hydraulic Fluid
Metalworking Fluid
General Industrial Oil
Gear Oil
Grease
Process Oil
Other Product Types
End-user Industry
Power Generation
Automotive and Other Transportation
Heavy Equipment
Food and Beverage
Metallurgy and Metalworking
Chemical Manufacturing
Other End-user Industries

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Key Market Trends

Engine Oil Segment to Drive the Market Growth

Engine oils are widely used for lubricating internal combustion engines in different types of automotive, off-road vehicles, and they are generally composed of 75%-90% of base oils and 10%-25% of additives. They are used in engines for different transportation modes, owing to their advantages, such as fuel efficiency, enhanced performance, temperature control, and engine protection. Various types of engine oils are synthetic oil, synthetic blends, and conventional oil. Synthetic oils are used in areas where high- and low-temperature performances are required. Conventional oils are used for simple and regular engine designs and manufactured according to various viscosity grades. Synthetic blend oils are a mixture of conventional and synthetic oils and have a high resistance to oxidation. High mileage oils, which are witnessing high demand, have unique properties, such as oil burn-off reduction and oil leak prevention.

Engine oils are typically used in applications for various purposes, such as wear reduction and corrosion protection, as well as ensuring the smooth operation of engine internals. The oils function by creating a thin film between the moving parts for enhancing heat transfer and reducing tension during contact of the parts. Moreover, engine oils are classified into two types, based on viscosity and performance. Kinematic viscosity is measured at 100°C and defines the viscosity of the engine oil from 20 to 60, primarily for the rising levels of viscosity. The initial “W” degrees, from the initial "winter", is mentioned to define the viscosity of the oil at low temperature levels. Those temperatures range between -35°C and -5°C, and the viscosity levels of the oil are stated as 0 W - 25 W. This temperature represents the lowest possible temperature at which the engine can be started when lubricated with an oil of the corresponding degree (e.g., a 15 W oil makes it possible to start the engine at up to -20°C). The temperature mentioned is the minimum temperature at which the oil can flow freely and lubricate the critical parts of the engine, in addition to ignition.

Oils without the letter W, which are intended for use at higher temperatures, are based on the viscosity at 100°C only. The engine oil for heavy equipment is used in the agriculture machinery, mining, off-road vehicles, and oil and gas industries. Owing to the increased engine oil change intervals, technological advancements are imposing a threat to the growth of the engine oil segment, in terms of volume consumption.

Nigeria Lubricants Market - Segmentation Trends

Automotive and Other Transportation to Dominate the Market

The automotive and other transportation segment is the largest end user industry in the lubricant market. The automotive industry requires lubricants in the pre-and post-production stages of automobiles. In the automotive industry, lubricants are used to reduce friction, protect against corrosion and wear, cleansing contaminants, and transfer power and heat.

Nigerian automotive and transportation industry has been volatile in the last few years. The country has been an importing nation with very little local automotive production to meet the demand after the severe decline in the local production from 1985 to 2005 due to recession and high production costs. Following 2013, the government introduced high tariffs of around 35% to 70% under its Automotive Industry Development Plan. The plan failed because local automotive production couldn’t meet the local demand and restrained the market with high prices. Due to the burden of unsustainable fuel subsidies, the government decided to remove the fuel subsidies recently. To counteract this, the country reduced import duties on foreign vehicles from 35% to 5%. This is expected to bring the prices down and accelerate the market demand for vehicles in the forecast period, which, in turn, driving the demand for automotive lubricants.

Nigeria's current vehicle market size is estimated at around 11.8 million units. Automotive sales in Nigeria declined significantly in the recent past. According to OICA, automotive sales in the country decreased from 17,000 units in 2018 to 9,800 units in 2019, which fell further in 2020, hampering the growth of the lubricants market. Another important factor in the country's automotive lubricants market is the high percentage of import of used vehicles, which require frequent maintenance. This contributed to a proportionally greater demand for lubricants from the country's automotive and transportation sector compared to other developing countries.

Nigeria Lubricants Market - Segmentation Trends

Competitive Landscape

Nigeria plans to decrease the influx of imported lubricants in order to stem the huge amount of foreign exchange losses associated with it. The Nigerian lubricants market is a consolidated market, where the top seven players account for more than 66% of the total market. The major players in the market are Total Nigeria PLC (Total), 11 plc (Mobil Oil Nigeria Plc.), Oando PLC, Eterna PLC, and Ardova PLC (Forte Oil PLC), among others.

Recent Development

  • In January 2021, Ardova PLC announced about its plans to acquire oil and gas retail outlet Enyo Retail and Supply Limited. Enyo accepted Ardova’s acquisition offer in a deal that is still subject to completion.
  • In November 2020, Ardova PLC sealed a deal with Shell Lubricants to become the major distributor of shell lubricants in Nigeria. The deal followed an earlier memorandum of understanding signed between Prudent Energy, Ardova PLC, and Shell Trading International Ltd.

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 Demand from the Expanding Wind Energy Sector

      2. 4.1.2 Other Drivers

    2. 4.2 Restraints

      1. 4.2.1 Increasing Drain Intervals in Automotive and Industrial Sectors

      2. 4.2.2 Slowdown in Automotive Industry

      3. 4.2.3 Unfavorable Conditions Arising Due to COVID-19 Outbreak

    3. 4.3 Industry Value Chain Analysis

    4. 4.4 Porter's Five Forces Analysis

      1. 4.4.1 Threat of New Entrants

      2. 4.4.2 Bargaining Power of Buyers

      3. 4.4.3 Bargaining Power of Suppliers

      4. 4.4.4 Threat of Substitute Products

      5. 4.4.5 Degree of Competition

    5. 4.5 Import and Export Trends

  5. 5. MARKET SEGMENTATION

    1. 5.1 Product Type

      1. 5.1.1 Engine Oil

      2. 5.1.2 Transmission and Hydraulic Fluid

      3. 5.1.3 Metalworking Fluid

      4. 5.1.4 General Industrial Oil

      5. 5.1.5 Gear Oil

      6. 5.1.6 Grease

      7. 5.1.7 Process Oil

      8. 5.1.8 Other Product Types

    2. 5.2 End-user Industry

      1. 5.2.1 Power Generation

      2. 5.2.2 Automotive and Other Transportation

      3. 5.2.3 Heavy Equipment

      4. 5.2.4 Food and Beverage

      5. 5.2.5 Metallurgy and Metalworking

      6. 5.2.6 Chemical Manufacturing

      7. 5.2.7 Other End-user Industries

  6. 6. COMPETITIVE LANDSCAPE

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

    2. 6.2 Market Share Analysis

    3. 6.3 Strategies Adopted by Leading Players

    4. 6.4 Company Profiles

      1. 6.4.1 11 PLC (Mobil Oil Nigeria PLC)

      2. 6.4.2 Ammasco International Limited

      3. 6.4.3 Ardova PLC (Forte Oil PLC)

      4. 6.4.4 Ascon Oil Company Ltd

      5. 6.4.5 A-Z Petroleum Products Ltd

      6. 6.4.6 Conoil PLC

      7. 6.4.7 Dozzy Oil and Gas

      8. 6.4.8 Eterna PLC

      9. 6.4.9 Lubcon

      10. 6.4.10 MRS Oil Nigeria PLC

      11. 6.4.11 Oando PLC

      12. 6.4.12 Techno Oil Ltd

      13. 6.4.13 Tonimas Nigeria Ltd

      14. 6.4.14 Total Nigeria PLC

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

    1. 7.1 Growth in Industrial Manufacturing Segment

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Frequently Asked Questions

The Nigeria Lubricants Market market is studied from 2016 - 2026.

The Nigeria Lubricants Market is growing at a CAGR of 1.54% over the next 5 years.

Total Nigeria Plc., 11 Plc. (Mobil Oil Nigeria Plc.), Eterna Plc., Oando Plc, Ardova Plc (Forte Oil Plc.) are the major companies operating in Nigeria Lubricants Market.

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