Base Oil Market: Based on Type (Group I, II, III, IV, V), Application (Automotive Oil, Industrial Oil, Metalworking Fluids, Hydraulic Oil, Greases, and Others), Geography (North America, Europe, Asia-pacific, and Rest of World), size, key players, trend and opportunities- Forecast up to 2026

The base oil is extracted from heating the crude oil, and the process is known as refining and is subject to a required set of specifications. The base oil is characteristically termed as lubricant base stock. The quality of a lubricant depends on the type of base oil used and the method of production used to produce the base oil. It is critical toward the grade of lubricant as base oils usually make up to 70-97% of the formulation of lubricants. Volatility in prices of crude oil restraints the base oil market with the potential disruption in the supply of oil and gas by events affecting the prices of crude oil. These include geopolitical and weather-related issues. For example, the Middle East, which has a prominent market share in the oil and gas industry but is highly volatile due to political issues. Since crude oil is a raw material directly used to produce base oil, price fluctuation is directly reflected in base oil prices. Global Base Oil Market was predicted to reach $44.3 billion by 2026 from $41.7 billion in 2020, recording a CAGR of 1.0% during the forecast period.

Base Oil Market Key Segments:

By Type

● Group I

● Group II

● Group III

● Group IV

● Group V

By Application

● Automotive Oil

● Industrial Oil

● Metalworking Fluids

● Hydraulic Oil

● Greases

● Others

By Geography

● North America

● Europe

● Asia-Pacific

● Rest of World

Research Methodology:

The base oil market has been analyzed by utilizing the optimum combination of secondary sources and in-house methodology, along with an irreplaceable blend of primary insights. The real-time assessment of the market is an integral part of our market sizing and forecasting methodology. Our industry experts and panel of primary participants have helped in compiling relevant aspects with realistic parametric estimations for a comprehensive study. The participation share of different categories of primary participants is given below:

Growth in Demand for Group II, and III Base Oils

• In the last few years, demand for Group I base oils have been decreasing regularly, and the production volume for Group II, III, and IV oils has been proliferating.

• The rise in Demand for high-solvency power-based oils is high in various industrial applications, where solvency is crucial. The lubricant industry needs high viscosity plus high solvency due to the requirement for high additive load in preparations. Group I paraffin has low solvency power; therefore, the demand for Group 1 base oil demand is decreasing.

• In addition, Group II, III, and IV oils have higher solvency power than that of Group I oils. Thus, Group II and III base oils are preferable for use in the formulation of lubricants, specifically for passenger cars, heavy-duty vehicles, and automatic transmission engines. This, in turn, would uplift the global base oil market during the forecast period.

Automotive Fluids Consisted of a Significant Share

● Based on the application, the global base oil market has been segmented into automotive fluids, industrial oils, metalworking fluids, hydraulic oils, greases, and others. The automotive fluids segment consisted of a significant share of the global base oil market in 2019. Base oils are widely used to manufacture lubricants in the automotive industry. Lubricants have a significant role in the automotive engine, transmission, and steering mechanisms by minimizing friction and heat generation.

● Hydraulic oils are another significant segment of the global base oil market and are widely used in excavators, backhoes power steering systems, transmissions, garbage trucks, aircraft flight control systems, and brakes. These provide excellent thermal low pour points, high viscosity index, oxidation stability, and superior heat transfer.

The Asia Pacific Dominates Base Oil Market

● In 2019, the Asia Pacific was the dominant region in the global base oil market. The demand for base oil is likely to increase at a significant stride during the forecast period due to a rise in the disposable income of people, the rapid growth of the automotive industry, and a surge in demand for electric vehicles in the region.

● The second-largest market oil market is Europe. Due to a rise in government spending and stringent government norms for CO2 emission. The development of making high performance lubricants using base oil is considered to surge the base oil demand in European countries.

The Key Players

Exxon Mobil Corporation, Chevron Corporation, Royal Dutch Shell plc, Calumet Specialty Products Partners, L.P., Neste Oil, AVISTA OIL AG, Nynas AB, Repsol S.A., Ergon, Inc., GS Caltex Corporation, and Hindustan Petroleum Corporation Limited, Saudi Aramco, PetroChina Company Limited, and Abu Dhabi National Oil Company are few leading players operating in the base oil market.