November 04, 2015 at 10:15 AM

Crude oil prices may not be expected to rise in the near future but according to analysts the demand for lubricants and base oils is predicted to increase significantly, buoyed by the rapidly growing global automobile sector.

The shift towards stricter emission norms and better fuel economy is increasing demand for high quality environmentally friendly lubricants, subsequently bringing about change in the base oil industry. Highly efficient base oils and the constantly evolving lubricants formulation processes are both important drivers for the growth of the base oils market.

Group I base oils currently account for the largest market share globally, both in terms of production and consumption. However, they are rapidly losing out to Group II and Group III base oils, both of a higher quality and are therefore capable of meeting emission norms in vehicles and conforming to the performance standards of new machines.

This shift in consumption has been observed acutely in certain regions and moderately in others. As Group I consumption gradually declines, bringing about an obvious downward pressure on prices, consumption of both Group II and Group III base oils is rapidly rising.