Global Base Oil Market, By Type (Group I, Group II, Group III, Group IV, Group V), By Application (E

Published Date: | Report Code : CH1958527


The Base Oil Market is expected to promise high growth owing to increasing demand Growing demand from the automotive industry in the recent years. Increasing demand from Applications including Engine Oil, Gear Oils, Metalworking Fluids, General Industrial Oils, Greases, Process Oils is expected to drive the growth of base oil market. This market has witnessed number of key developments by major companies including Royal Dutch Shell PLC, Chevron Corporation, Neste Oil, Avista Oil AG with focus on organic as well as inorganic growth strategies. Developing regions including Asia Pacific and Middle East have been among the high potential markets with high growth in some of the key economies.

Base oil is widely used as a raw material for the production of lubricants. The composition of base oil and its additives varies depending upon application. The major factors driving the growth of the market are the growing demand from the automotive industry and rapid industrialization in developing nations. However, automobile manufacturers focusing on engine downsizing and extended oil change intervals are likely to hamper the growth of the market studied.

Segment Analysis

Based on the type, Group IV segment is expected to grow at the highest CAGR during the forecast period. This is due to a rise in Group IV base oils consumption worldwide. In numerous industrial and automotive applications, the use of Group IV base oils has grown as they give outstanding efficiency when coupled with additives.

Based on application, the engine oil segment is expected to dominate the demand for base oil, due to the growing demand for engine oil from industries, such as automotive, power, heavy equipment, metalworking, chemicals, and others. Engine oils are widely used to lubricate internal combustion engines and are composed of 75-90% base oils and 10-25% additives. They are typically used for applications, such as wear reduction, corrosion protection, and smooth operation of the engine internals. They function by creating a thin film between the moving parts, for enhancing heat transfer and reducing tension during the contact of parts. Automotive industry stands to be the largest consumer of engine oil. Currently, high-mileage engine oils are in demand in the automotive industry, owing to the properties that help in oil leak prevention and reduction in oil-burn offs. Most light and heavy vehicle diesel and gasoline engines use 10W40 and 15W40 viscosity grade oils, globally. Thus, with an increase in automotive production, the demand for engine oil is expected to increase significantly in the coming years, which is further expected to drive the growth of the base oil market.

Key Factors Impacting Market Growth:

  • Growing demand from the automotive industry

  • Rapid industrialization in developing nations

  • Growing construction activities in several regions

  • Engine downsizing and extended oil change intervals

Regional Analysis

The Asia-Pacific region is expected to dominate the global market share during the forecast period. The robust growth in automotive production, growing industrial sector due to rising investments in the region by multinational companies, and high demand for gear oil, grease, etc., from industries, such as heavy equipment, power, and metalworking, are some of the key drivers for the base oil market in the region. China, one of the world’s largest automotive producer, is majorly focusing on increasing the production and sale of electric vehicles in the country. For this purpose, the country plans to increase the production of electric vehicles (EVs) to 2 million a year by 2020, and 7 million a year by 2025. India is experiencing investment in the automotive industry, which is supposed to further boost the country's output. For instance, in 2018, Hyundai planned an investment of USD 1 billion in India by 2020. In addition, countries such as Indonesia, Malaysia, and Thailand have also been witnessing strong growth in the production of vehicles in the region. Hence, all such trends in the automotive industry in the region is expected to add to the demand for base oil in the region during the forecast period. In addition, growing investments in the construction sector are anticipated to boost the demand for lubricants used in construction activities and in heavy equipment. Countries, such as India, China, Philippines, Vietnam, and Indonesia, have been witnessing strong growth in the construction industry. Investments in residential and commercial construction in these countries have been increasing at a robust rate. This is further expected to increase the demand for base oil in construction application in the coming years. Hence, all the favorable market trends are expected to drive the demand for engine oil, greases, gear oil, etc., which are further projected to drive the growth of the base oil market in the region, during the forecast period.

Companies Covered: Royal Dutch Shell PLC, Chevron Corporation, Neste Oil, Avista Oil AG, Nynas AB, Petronas, Repsol, Evonik Industries, Lotos Oil SP Z.O.O., Ergon Inc., Calumet Specialty Products Partners Lp, Exxon Mobil Corporation, Total S.A., H&R Ölwerke Schindler GmbH

Market Segmentation:

By Type:

  • Group I

  • Group II

  • Group III

  • Group IV

  • Group V

By Application:

  • Engine Oil

  • Gear Oils

  • Metalworking Fluids

  • General Industrial Oils

  • Greases

  • Process Oils

  • Others

By Region:

  • North America

    • By Country (US, Canada, Mexico)

    • By Type

    • By Application

  • Western Europe

    • By Country (Germany, UK, France, Spain, Rest of Western Europe)

    • By Type

    • By Application

  • Eastern Europe

    • By Country (Russia, Turkey, Rest of Eastern Europe)

    • By Type

    • By Application

  • Asia Pacific

    • By Country (China, Japan, India, Rest of Asia Pacific)

    • By Type

    • By Application

  • Middle East

    • By Country (UAE, Qatar, Iran, Saudi Arabia, Rest of Middle East)

    • By Type

    • By Application

  • Rest of the World

    • By Region (South America, Africa)

    • By Type

    • By Application

Reasons To Buy This Report:

  • Market size estimation of the global base oil market on a regional and global basis

  • Unique research design for market size estimation and forecast

  • Profiling of major companies operating in the market with key developments

  • Broad scope to cover all the possible segments helping every stakeholder in the market


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