April lubricants industry market update.
- Thread starter Foxtrot08
- Start date
Anything lubricants based will at minimum, be affected price wise. At worse, it could be unobtainable.
From previous posts I had understood the main impact to be to the GTL base stocks. From your first post in the thread, I assume your thesis is GpII or Gp IV base stocks prices climbing due to "contagion" of Gp III consumers (Blenders I guess?) going anywhere they can to continue to make product in the absence of Gp III GTL inputs? Or were Gp II and IV supply chains impacted more than we previously knew?
(side question) Are full synthetic transmission fluids GTL based? (e.g. MB 236.15 fluids or Toyota WS and CVT fluids).
Group II and remaining group III production is being forced into distillate production - diesel and jet fuel, as that is a much larger global demand, with a much more immediate impact on day to day life.
As well, strictly the Shell Pearl facility, was GTL. Bapco, Adnoc and Aramco facilities all produce group II/II+ and group III products, which feed into the U.S. market. They are all cut off and/or damaged.
The problem, I’m trying to paint a picture of, or a view of, is there’s no replacement.
There’s not enough of anything, to currently fulfill global demand, let alone US demand.
Prices will continue to climb, shortages will happen, because essentially, 50% of base oils output, has been halted or reduced. Possibly more, possibly a little less.
And there’s nothing to make up for that 50%. There’s not enough PAOs, esters, ANs or anything else to make up for that.
Sure, some demand destruction will lead to more group II consumption. But that’s already an extremely tight market. KPP Canada is currently down. Motiva TX is just coming back up from a turn around, so they’re starting with 0 inventory of product and will be living hand to mouth on group 2s.
The base products for 50% of the lubricants market, is essentially gone, with about zero, turn key replacement. As there was extremely little excess base oil capacity in the market anyways.
I can get into all the reasons “why” but that’s not the point of this thread. The point of this thread is in my opening statements. And how it’s all going to play out, is going to be really interesting.
I don’t mean to get snarky. But this is why I haven’t slept well in… about 50 days. I have 200+ employees to worry about. I’m not shrugging this off or taking it lightly. The article written was to provide information to my customers, friends and well - everyone here. You’re the top 1% or more of lubricant users. You do your research, even if you disagree with me. Or may not like my opinion, or even me. You’ve gone out of your way to educate yourself, in a pretty niche topic.
Give yourself a round of applause, at least from me.
I’m just trying to let you know what’s going on from my perspective.
It’s spooky right now. I’m not going to add further conjecture or anything I don’t have in written facts from independent resources. That’s not the point of this thread. Nor is politics. Nor is anything certain brand related.
Just, here’s the facts as it stands in April. I will be writing another one in May as I get the analytics from April.
Patman
Staff member
I think I’ll go with what a company owner with actual experience in the industry says…
Might want to scoop up some of the "never to be seen again in our lifetime deals" at AAP for the Fram Global ATF or the Valvoline Hybrid ATF (MaxLife equivalent) if they fit your upcoming ATF needs.
Over futures market and what ifs? Certainly not an “unattainable” increase. There’s no doubt that smaller companies will feel the pinch. But there’s next to no way that you’ll have to go to Walmart and trade plasma for a jug of Mobil 1. $5-8 increase at best.
Dollars cannot magically produce real goods. I thought we learned this in 2020.
Sounds like a good sized stash is more important than ever! Good thing there’s a fair amount of closeout Fram filters & discounted synthetic oil here in the attic & garage… Might be a good way to get EVs more popular-double the price of gas, and make motor oil hard to come by!
I wish it was 30%.
I’ve never seen price increases like this in my life. I’ve been full time since 2008. And I was literally, born in this industry. Everyone knows who I am now.
I wasn’t necessarily going to reply. However, GIII base oils have increased over $8 a gallon so far, over February 2026 prices.
To your point, it’s where demand destruction sets in. What is that price point? Where do people decide to say “that’s too much.” And not change their oil? Or go to a blend, or a conventional product? Is it $25-30 a gallon? At my cost, which is buying literally millions of gallons a year. Not retail.
Relief is well into the distant future. Chevron, Mobil and Shell’s group 3 expansions in the U.S. and Europe aren’t due online until 2027 and 2028.
Even if the geopolitical situation was solved tomorrow. You’re trying to restart a refinery that has been battle damaged and then crashed into a shut down. Restarting a refinery thar has been properly planned shutdown, is tricky. Look at Valero in Texas. Now, try to restart a crashed refinery.
Then you have another 90 days for supply to even hit my doorstep.
Not including how long it’s going to take to repair and restart battle damaged and crashed refineries.
The Mobil 1 0w16 purchase I referenced in post #8 has been cancelled by Walmart for no stock. At 4:00 PM they said low stock, I ordered the oil, all good. An hour later I got a text removing it from my order
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My local Walmart that had a wall of Valvoline Restore and Protect 3 months ago has... none, in any viscosity. AAP had three 5qt jugs at $39ea.
Make of that info what you will.
[EDIT] I'm not saying the current lack of Valvoline Restore and Protect is related to the current and ongoing geo-political events. However, I don't think it's helping, nor do I think it's going to get any better anytime soon.
@Foxtrot08 aka Paul Lyden Jr. Thank you for this valuable market update. We appreciate your expertise and willingness to share with the community.
Wayne
Wayne
With this.
I’m going to emphasize I will not talk about brands, pricing, or anything I personally deem inappropriate. This is simply an industry perspective into the current market situation.
I am not in retail. I do not supply anyone like Walmart, TSC, Napa, etc.
I will not speculate or give any specific information on any brand in particular that is not publicly published information. Period.
I also, absolutely will not entertain or endorse any political commentary or opinions. This is business to me, my livelihood. Not politics, I’m not a politician. I sell oil for a living.
I can simply speculate much, as anyone else into retail or OEM supply. This is strictly a distributors perspective. However it may correlate, as it sometimes does. I know this forum is DIY oriented. So what I see and understand, does not always directly translate to what happens on the retail end.
I will say, please support your local oil distributors. There are a lot of small, individual or family owned companies that, live and breathe lubricants. But, I also understand that we are 90% or greater directed to B2B sales. There are people like Pablo and HPL, that are DIY focused, they deserve your attention as well, as they make, provide and sell great products, too.
The oil industry is small, but at the same time, vast. We all have our niche, our backgrounds, and what we know. We also, don’t know what we don’t know. We are just people, like you.
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@Foxtrot08, any thoughts on what this means to Def availability for the next 2 years?
It’s been publicly stated by my DEF suppliers, that supply is not going to be a problem. However pricing is going to be extremely volatile.
Owen Lucas
$100 Site Donor 2023
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Is my Honda's OCI now going to 20k like the oil filter?
I wonder if this will force manufacturers to expand the list of acceptable oil weights that you can use in your car & truck during times of shortages and low supply.
4wd
$50 site donor 2026
May the force be with you to proceed - save the old jugs.
