The Independent Lubricant Manufacturers Association said the American Petroleum Institute’s latest extension to emergency provisional licensing shows the base oil supply crisis is far from resolved.
API said the extension, its second since the program was introduced in March, gives engine oil manufacturers more time to manage shortages caused by disruptions to API Group III supplies in the Middle East. The program allows API-licensed manufacturers to temporarily substitute base oils or adjust formulations when approved components are unavailable.
“API’s decision to extend emergency provisional licensing reflects the fact that the base oil supply crisis is far from resolved,” Holly Alfano, CEO of ILMA, told Lube Report. “Lubricant manufacturers are still facing significant constraints and limited sourcing options, so this continued flexibility is essential to keeping products available without compromising performance.”
ILMA had lobbied API in March to invoke the force majeure provisions in Section 6.9 of API 1509, which governs the Engine Oil Licensing and Certification System. The association said at the time that shortages were leaving blenders unable to maintain approved formulations as Group III availability tightened and spot supplies disappeared. API activated the emergency provisions on March 26.
The latest extension acknowledges continuing disruption at major Group III production sites. Missile and drone attacks damaged energy infrastructure in the Middle East, affecting facilities operated by ADNOC, Bapco Energies and the Pearl gas-to-liquids plant in Qatar. Damage to infrastructure and restrictions on shipping through the Strait of Hormuz have further constrained supplies.
The emergency program does not provide blanket permission to change formulations. Each EOLCS licensee must sign an agreement with API, document its supply problem and identify proposed alternative materials. Manufacturers must also provide technical information showing that formulation changes will not adversely affect performance and submit revised product traceability codes.
About a dozen companies had applied for emergency licensing by June, according to Bill O’Ryan, API’s director of EOLCS and diesel exhaust fluids. Once the emergency period ends, licensees must either return to their original formulations or seek formal approval for revised products. API also requires testing of modified formulations under the relevant standards.
Section 6.9 is intended for unexpected supply disruptions caused by events including natural disasters, explosions, fires and acts of terrorism. API last invoked the provision during the COVID-19 pandemic in 2020.