The U.S. has been the largest lubricant consuming country market in the world, although its market share is declining. The U.S. used to account for 25% of the total, and has now dipped below 22%. China is expected by 2017/18 to surpass the U.S. to become the largest lubricant consuming country market, according to Kline & Company’s "Global Lubricants: Market Analysis and Assessment".

The presentation, given by George Morvey, Industry Manager in the Energy Practice at Kline & Company during a web presentation October 15, is based on Kline’s 12th annual assessment of the global
lubricant industry, published in September 2014

Global Lubricants: Market Analysis and Assessment covers all leading product categories and lubricant consuming country markets. Process oil and marine engine oil are included in Kline’s definition of finished lubricants. The base year is 2013 with FutureView forecasts to 2018 and 2023. Volumes are reported in kilotonnes (KT).

According to the study, global lubricant demand is estimated at 39.5 million tons in 2013, up slightly from 38.8 million tons in 2012, with the Asia-Pacific region accounting for 43%, followed by the Americas region at 32% and Europe at 17%. Of this, automotive engine oil (PCMO and HDMO) accounts for 44% of this demand.

"The top thirteen largest lubricant consuming countries (U.S., China, India, Russia, Japan, Brazil, DACH*, S. Korea, Indonesia, Canada, Mexico, UK and Thailand) account for 73% of the total lubricant demand", said Morvey.
* DACH countries are Germany, Austria and Switzerland.

Presently, the U.S. is the largest lubricant consuming country market, although its market share is declining. China is expected by 2017/18 to surpass the U.S. to become the largest lubricant consuming country market. India follows at a distant third place.

Shell continues as the #1 global supplier of finished lubricants in 2013, followed by ExxonMobil, BP, Total, Chevron, PetroChina, Sinopec, Idemitsu, Lukoil and Fuchs, in that order. The global “Top 10” account for over half of total lube supply in 2013, while the global “Top 20” account for nearly two thirds of total lube supply in 2013 said Morvey.

Global demand for PCMO is forecast to reach over 8.0 million tons by 2023, with 5Ws and 0Ws combined accounting for about 44%; in 2013, it was 37%. The continuing global migration to lower visgrade PCMO will result in higher penetration of synthetics, semi-synthetics, higher revenues, and conversely longer ODI and suppressed overall PCMO growth. The penetration of lower viscosity grade PCMO varies by region with North America being the greatest, followed by Europe.

With improvements in quality levels, come higher penetration of synthetics and semi-synthetics and increased revenue opportunities. OEM factory/service fill recommendations and owners’ desire for longer ODI are key drivers for synthetic demand. Opportunities exist for the entire lubricant supply chain to promote synthetic in all regions and countries, continued Morvey.

Global demand for HDMO is forecast to reach about 10.5 million tons, with SAE 15W-40 accounting for 50% of the total market by 2023. Most encouraging for increased synthetic HDMO penetration is the shift from monograde to multigrade,and within multigrade, from heavy visgrades like 20W/25W’s to lighter visgrades like 10W’s and 5W’s. Monogrades presently account for 32% of the global demand, but is predicted to drop to only 21% by 2023. As with PCMO'S, the use of lower viscosity grade HDMO and monograde also varies by region. The use of 15Ws viscosity grade HDMO is the greatest (percentage) in North America. Monograde HDMO usage remains high in developing country markets, such as Indonesia.

China, India, Russia, and Brazil continue as growth engines for global lubricant demand due to industrial activity and expanding vehicle production and parc. Indonesia and Thailand join China and India as growth engines in the Asia-Pacific region, said Morvey.

Global lubricant demand is projected to reach 45 5 million tons by 2023 with the greatest growth rate being Asia-Pacific region at just under 2.5% CAGR, and North America and Europe the least, far below 1% CAGR.