Lubricant and oil prices surge during August, Shell leads the way in the finished lubricants market and Iran announces a massive reserve discovery.
Finished lubricant prices were raised by between 5% and 9% in late July/early August with suppliers blaming a rise in the cost of raw materials. Most of the majors and a range of second-tier producers all announced price hikes to their customers for finished products. In a summary by Lube Report's George Gill, one distributor was philosophical about the price rises, but commented that distributors may not have fully benefitted from the reduction in crude prices at the beginning of the year.
According to Kline, in 2008 the overall market for finished lubricants was 38.2 million tonnes, more than 2% down on the previous year. However, Shell retained their position as world leaders in the finished lubricants market for the third consecutive year with a 13% share, closely followed by ExxonMobil with 11%. BP and Chevron were third and fourth respectively.
With the Asia-Pacific region driving sales volume - China and India accounted for 18.4% of the world's lubricant consumption last year - it is little surprise that PetroChina rounds off the lubricant market's top five.
Kline reported that of the three main market segments, consumer automotive appeared to be the least effected by the the start of the recession in comparison to the commercial automotive and industrial oils/fluids segments.
Meanwhile oil prices climbed gradually during August, hitting $73 and setting a new high for 2009, supported by positive economic news from the US set against a weaker dollar.
There was further good news for global oil supplies with the announcement of an estimated 8.8 billion barrel discovery in the Khuzestan province of Iran, an area which is already producing oil. Amongst others this month, Chevron also announced a new find, this time on the Angolan Cabinda coast. A recent report showed, however, that the largest single oil fields are in Saudi Arabia, Kuwait and Azerbaijan.