The global finished lubricants market is estimated to grow at a CAGR of 5.4 % between 2018 and 2026. The lubricant business or the finished lubricant industry is a significantly profitable business for the downstream petroleum industry and has been crucial for providing opportunities for the oil marketing companies to grow their business and also providing the target markets for the new entrants.
The industry growth has been evident across all the regional markets. Globally rising average vehicle ownership rates and the rapidly developing rate of industrialization in the developed as well as emerging countries are the major factors to drive product demand in the past five years and it is expected to continue over the next decade as well.
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Aftermarket demand of motor vehicles constitute the largest share in terms of rate of consumption of finished lubricants. Automotive finished products demand is anticipated to increase more rapidly in the developing nation owing to the fast increase in the number of trucks and cars in use. Moreover, significant enhancements in in finished lubricant quality has been crucial for allowing long drain intervals and restraining stronger product demand in all the regional industries.
Product demand form the global manufacturing industry has witnessed healthy growth driven by the increase in manufacturing output mainly in the developing regions. The regional industries including Eastern Europe, Asia, some parts of Africa, Middle East and South America are anticipated to immensely benefit from the continuous shift in worldwide manufacturing activity particularly to these regions.
Gains from other end-use industries including construction, agriculture and non-motor vehicle transportation and manufacturing business through 2017 has been exceptionally high compared to in 2015 and 2016. Substantial growth in economy, increasing investments in infrastructure development and construction activities, and most importantly the rising mechanization of the economies in the developing nations will eventually result in stronger product sales volumes in these particular market space.
The worldwide finished lubricant industry is segmented under six primary parameters i.e. by the types of finished products, by source of base oil, by grade of base oils, by viscosity grades, the different application segments of finished lubricants and by the end-use industries of these products. Product categories included in the report scope includes metal working fluids, transformer oils, gear oils, hydraulic oils and engine oils. Engine oil segment is further categorized into different viscosity grades including 0W, 5W, 10W and 15W, 20W, 25W.
The market is segmented into different base oil sources including mineral base oil, synthetic, semi- synthetic and others. By the base oil grades the industry is bifurcated into grade 1, 2, 3, 4 & 5. The different application segments included covers compressors, transformers, bearings, natural gas engines, hydraulics, metal working, heat transfer equipment and others. The end-use segments are further bifurcated into automotive, oil refining, textile manufacturing, metalworking, petrochemical, industrial and others.
Asia Pacific region accounted for the largest regional market share in 2017. Sales volume in the region are expected to grow at the fastest rate compared to the other regional industries. This is owing to rising vehicle ownership rates and rapidly increasing industrialization in India, China and some of the Southeast Asian countries. It is projected that the regional markets of Middle East, South America and few parts of Africa will experience above average growth in the next three to four years in comparison to its growth in the past four years. Expanding motor vehicle parks, rising manufacturing output and developing economic stability are some of the major factors that will indirectly influence in increasing consumption of finished lubricants.
Some of the leading industry participants include BP, Castrol Lubricants, Shell Oil Marketing Company, Essar Oil, Sinopec Corp., Universal Lubricants, Bharat Petroleum, Hindustan Petroleum, Reliance Oil, Gulf Oil Corporation etc.