Base and Additive Prices 1998 and 2008 (June 2008)

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MolaKule

MolaKule

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Lubes 'n' Greases (LNG publishing company) had a table showing these items in their July 2008 Magazine for a gallon of 5W30 oil, (pp. 12-13):

Paraffinic Base Oil/Gallon - 1998 - $0.70
Paraffinic Base Oil/Gallon - 2008 - $3.53 (+404% since 1998)

Additives - 1998 - $0.57
Additives - 2008 - $1.25 (+119% since 1998)

Cost total formulated 5W30 oil/Gallon - $1.27 in 1998
Cost total formulated 5W30 oil/Gallon - $4.78 in 2008 (+276% since 1998)

Average Retail price formulated 5W30 oil/Gallon - $4.10 in 1998
Average Retail price formulated 5W30 oil/Gallon - $9.92 in 2008 (+146% since 1998)

It is interesting to see that the increase in the retail price of formulated oil has only "roughly" followed the increase in additive prices, and not base oils.
 
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Originally Posted By: GROUCHO MARX
Greedy oil companies. How dare they not pass along the entire base oil increase!


No kidding. It serves to show the truth, eh? Just like in this recent spike in oil prices where refineries reduced their margins to razor-thin levels to try and limit the cost of refined goods.
 
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It is interesting to see that the increase in the retail price of formulated oil has only "roughly" followed the increase in additive prices, and not base oils.


I can't prove it ..but as I've said before, I think that motor oil, at least our conventional oils are "value added byproducts" of the massive crude refining process that we experience due to the massive demand we have for fuel.

You've got to do something with those components that make up lubricants whether there is demand for them or not.
21.gif
 
Originally Posted By: HTSS_TR
CSK and/or Valvoline lost money when they had SynPower on sale for $0.49/qt after rebate about 3 months ago !!!
But what is their average profit margin on their annual sales?
 
Originally Posted By: Steve S
Exactly Gary and lots of other stuff is made out of petrolium products.


Well, I think it's why we're asked to buy so many things make of plastic. Not just in terms of "availability" ..but it more or less is thrown at us. I did a oil aisle check while buying brake clean at Wally's ..and just looked around. Literally tons of plastic everywhere I looked.

I personally think that they should make park benches or off shore erosion control/marine life habitat with the stuff ..but what do I know
21.gif


I guess I should pitch in a buy the $8.95 commemorative cup if I go to the theater ...
 
Originally Posted By: Steve S
Originally Posted By: HTSS_TR
CSK and/or Valvoline lost money when they had SynPower on sale for $0.49/qt after rebate about 3 months ago !!!
But what is their average profit margin on their annual sales?


They made good money on non-sale items that 90% of their customers willing to pay. But I did not buy anything else whenever I went there to buy cheap oils on sale. Most auto parts I need for my 3 cars were bought online at discount sites (with free shipping for orders over $50) or at WM.
 
When we were formulating (2003-6), PAO's were increasing in price about 3-15% per year and ester only about 1.5%-5% per year.

We never used any Group III in production work, so I have no trending data for Group III, but did some experiemtnal work for mtl's using Group III's.

However, our chemical suppliers were posting new price list increases every three months, so I was suprized to see additive prices increasing only 120% over those ten years.

Of course our chemical suppliers supplied some very exotic stuff for us.
 
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In the "Base Oil" article of the same issue (remember this was last June-July 2008 reporting), Carolyn Green stated, "From a base oil production standpoint, producers have no choice but to push thrrough the rising costs of feedstocks.....Blenders, in the meantime, said they are being trampled. They have been absorbing round after round of base oil and additive price hikes, which are immediate expenses. Unfortunately for them, there is a lag time of about 90 days on average (credit terms vary widely downstream), before these cost can be recouped."
 
Does the oil company give volume discount to blender when they have a surplus or when exceeding a certain volume?

I know DELL and various DRAM/NAND companies does so at the end of a quarter to shore up the volume for the volume discount or financial reports, and literally sell the products at a loss during those time.

Of course, most of their profits are made during the rest of the time.
 
Originally Posted By: Steve S
Exactly Gary and lots of other stuff is made out of petrolium products.


Gary is made out of what?
 
Originally Posted By: moribundman
Originally Posted By: Steve S
Exactly Gary and lots of other stuff is made out of petrolium products.


Gary is made out of what?
Gary is made out of sugar and spice and everything nice!
 
Originally Posted By: moribundman
Originally Posted By: Steve S
Gary and lots of other stuff


Gary is the right stuff?
You will have to ask Mrs. Gary.
 
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