Base oil is widely used as a raw material for the production of lubricants. The composition of base oil and its additives varies depending upon application. Rapid industrialization is one of the key factors driving the global base oil market. In addition to this, rise in sales of vehicles and increase in logistics and trade play a significant role in boosting the base oil market. Growth in the global automotive sector and increase in number of manufacturing plants is anticipated to propel the global base oil market. As per a market report by Transparency Market Research, the global base oil market was recorded at US$ 33.2 bn in 2017. The market is projected to expand at steady CAGR of 1.7% during the forecast period that is from 2018 to 2026.
The global base oil market is classified on the basis of type and application. In terms of grade, the global base oil market is classified on the basis of group I, group II, group III, group IV, group V, re-refined, and naphthenic. The group I segment can be further sub-segmented into SN500, BS150, SN150, SN250, and others. Similarly, the group II segment can be sub-segmented into N600, N250, N150, N500, and others. The group III segment can be sub-segmented 8cSt, 2cSt, 2cSt, 4cSt, and 6cSt. The naphthenic segment has been further divided into 400-800 SUS, 80-130 SUS, 35-60 SUS, 200-300 SUS, and above 1200 SUS. It has been noticed that the group I is likely to lose its market share to group II and group III. This is mainly because of the stringent regulations by the government to reduce vehicle emission. Group II and group III consist of higher level of base oil composition. Thus resulting in lesser vehicle emissions.
In terms of application, the global base oil market is classified into process oils, industrial oils, hydraulic oils, automotive fluids, metalworking fluids, and others (including rust prevention oils, greases, and marine lubricants). Among them, automotive fluids are anticipated to lead the base oil market. This is mainly because of the increase in number of vehicles across the globe.