The global base oil market is expected to reach USD 40.47 billion by 2024, according to a new report by Grand View Research, Inc. Growing demand for industrial lubricants, greases, hydraulic fluids, and metal working fluids made from raw stock fluids such as base oil is anticipated to remain a key driving factor for the market growth.
The shifting trend towards adoption of Group II and Group III base oil owing to the shutdown of Group I oil production facilities in Europe and Asia Pacific is anticipated to fuel industry growth significantly.
Rapid expansion in the automotive sector in emerging Asian countries such as China, India, Indonesia, and Thailand is expected to boost demand at a rapid pace. The increasing demand for automotive fluids is owing to excellent properties such as improved oxidative stability, increased viscosity index, high level of saturation and low sulfur content.
Group II base oil accounted for over 20% of overall volume in 2015. They are manufactured by the hydro-cracking process, and it has high saturated and low sulfur than compared to Group I products.
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Further key findings from the study suggest:
- The global base oil market demand was over 37.64 million tons in 2015, and is anticipated to exceed 45 million tons by 2024, growing at an estimated CAGR of 2.4% from 2016 to 2024
- Automotive oils were the largest application segment and accounted for over 40% of total market volume in 2015. The growth of lubricants industry on account of increasing automotive production in Asia Pacific is expected to drive this segment over the forecast period.
- Increasing demand for metalworking processes such as cutting, welding and forming across various applications such as automotive, foundry, ships, aircrafts, milling and industrial machinery is expected to drive metal working fluids demand
- Asia Pacific was the largest market, accounting for over one-third of the total market volume in 2015.The positive outlook towards automotive and industrial manufacturing sectors of emerging economies such as China, Vietnam, India and South Korea is anticipated to promote the usage of industrial and automotive lubricants
- BP and Russian Rosneft have announced to sign an agreement to create a new joint venture company, Yermak Neftegaz LLC, to conduct exploration activities in the Yenisey-Khatanga and West Siberian basins
- The market is highly fragmented among multinational players and small domestic players. Major companies identified in the market include ExxonMobil, Chevron Corp., British Petroleum PLC, Royal Dutch Shell, Sepahan Oil Company, LukOil, Saudi Aramco, S-Oil Corp., Indian Oil Corp. Ltd., Total, Motul, Repsol, Gulf Oil UAE, Petrobras and Tupras
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