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The Base Oil Industry in US is Shifting from Group I to Group II and III. The U.S. Group II and III Base Oil Market to Reach $9.9 Billion by 2027. - Arizton

·5 min read
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SIRIUS MANAGEMENT CONSULTING

The U.S. group II and III base oil market are expected to reach $9.9 Billion by 2027 from $7.08 Billion in 2022.

Chicago, June 16, 2022 (GLOBE NEWSWIRE) -- According to Arizton’s latest research report, the US group II and III base oil market is expected to grow at a CAGR of 6.9% during the forecast period. The installation of catalytic dewaxing requires low investment, delivers outstanding performance at low temperature, and offers flexibility to produce both lubricant base stock and light distillates. Therefore, it fuels the demand for catalytic dewaxing technology for producing group II and III base oil. For instance, Chevron was the first company to combine catalytic dewaxing with hydrocracking and hydro finishing technology in its California base oil plant in 1984.

U.S. Group II and III Base Oil Market Report Scope

Report Attributes

Details

MARKET SIZE (2022)

$7.08 Billion

MARKET SIZE (2027)

$9.9 Billion

MARKET SIZE BY VOLUME (2027)

12.8 million Tons

CAGR (2021-2027)

6.94%

 

BASE YEAR

2021

 

FORECAST YEAR

2022-2027

MARKET SEGMENTS

Technology and Application

GEOGRAPHIC ANALYSIS

US (South, Midwest, West, and Northeast)

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In recent years, the US base oil industry is experiencing a shift from group I base oil to group II & group III base oil, driven by increased regulatory standards, circular economy, and demand for high-quality lubricants. In addition, the increasing demand for low viscosity and low volatility lubricants is growing due to the increasing trend toward better fuel economy. Group II & III base stock products are widely used across the globe.

One of the major sectors that consume these products on a larger scale is the automotive sector. This is primarily due to the increasing production of vehicles in the US. Moreover, economic growth in the US has played a vital role with respect to demand and consumption. However, the market poses moderate fragmented behavior among vendors. The competition among these companies has intensified, leading to the introduction of many innovative and advanced solutions in the market.

Market Insights

  • The US market for group II & III base oil is intensifying due to the low sulfur content and low viscosity. They have a higher saturation of chemical bonds that are effective in meeting the current market trend of reducing carbon footprint and improving fuel economy.

  • API group II base oil is in a dominant phase, while group III base oil is in the evolving phase and is primarily used in high-performing engines.

  • US automotive oil is the dominating segment. It consumes the major chunk of group II & III base oil, followed by industrial oil, process oil, and others.

  • The Southern region is the largest and fastest-growing group II & III base oil market accounting for more than 32.15% of the share. Moreover, Midwest and Western region is expected to witness significant growth in the coming years.

Looking for more info? Click: https://www.arizton.com/market-reports/us-group-ii-and-iii-base-oil-market

Key Offerings:  

  • Market Size & Forecast by Revenue | 2021−2027

  • Market Dynamics – Leading trends, growth drivers, restraints, and investment opportunities

  • Market Segmentation – A detailed analysis of technology, application, and region

  • Competitive Landscape – 3 key vendors and 10 other prominent vendors

Market Segmentation Analysis

Technology

  • Hydrotreating

  • Hydrocracking

  • Catalytic

  • Dewaxing

  • Others

Application

  • Automotive Oil

  • Industrial Oil

  • Process Oil

  • Others

Region

  • U.S.

    • South

    • Midwest

    • West

    • Northeast

Which Region in the Market is Gaining High Traction?

The group II & III base oil market in South US is expected to reach $3.3 million by 2027. In Southern US, Texas and Florida are the major markets for re-refined base oil. The demand for re-refined base oil in the Southern US is driven by stringent regulations due to emission regulations and the growing trend of sustainability. Stringent used oil collection regulations, the presence of domestic and international re-refined base oil players, and strong infrastructure development for used oil collection are driving the market growth.

Strategies Adopted by Vendors to Cop Up the Competitive Market

The US group II & III base oil market has a moderate number of large players as well as several small to medium-sized players. Group II & III base oil continues to remain one of the key business segments for vendors within the base oil industry owing to the immense use of base oil for lubricants production. The group II & III base oil market in the US is largely driven by the improving US economy and the strong presence of automotive industries. With high-quality base oil being one of the key focus areas for vendors, major players concentrating on offering base oil with low viscosity continue to enjoy growth and profit.

Furthermore, players are focusing on developing innovative products and investing in R&D initiatives to broaden their product portfolios. Although established players dominate the market, new entrants are focusing on developing end markets that have enormous growth opportunities. Vendors are expected to benefit from the rapidly changing market scenario, which places an increasing emphasis on sustainability.

KEY VENDORS

  • Chevron Corporation

  • Exxon Mobil Corporation

  • Philips 666 Company

OTHER PROMINENT VENDORS

  • Dodge

  • HollyFrontier Corporation

  • Pure Performance

  • Resolute Oil

  • Neste

  • Puraglobe

  • AGC Refining and Filtration

  • Heritage-Crystal Clean

  • Safety-Kleen systems

  • Vertex Energy

Explore our chemicals materials profile to know more about the industry.

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