The 2020 global Base Oil market is estimated to drop by $3.6bn from 2014 levels.
Base oil - still in demand Image: Kitraco
Despite this depreciation in value, the demand for base oils will expand at a CAGR of 1.40% from 2015 to 2020 to rise to 39,614.7 kilo tons by 2020, according to Transparency Market Research.
The research states that high demand for base oils in end-use industries is being offset by falling crude oil prices and refiners’ gradual shift towards heavy, sour crude oil. However, TMR believes the introduction of gas-to-liquid technology is likely to open up opportunities for competitively priced pure and efficient base oils with
The automotive oils application segment currently still dominates the overall market, with increased demand for superior grade Group II and Group III base oils in North American and European countries.
Asia Pacific, South America and the Middle East will see rising demand for certain grades of Group I, such as Bright Stock.