POAs are produced by a fairly small number of manufacturers, with global capacity at around 730,000 metric tons per year. The largest producers include ExxonMobil, which has capacity of 301 000 t/y, Ineos Oligomers with 355,000 t/y and Chevron Phillips Chemical with 43,000 t/y.

Growth is occurring in regions such as China where independent refiners and joint ventures have begun developing PAO facilities. China National Offshore Oil Corp. in partnership with Shell, licensed Neste technology to build a PAO plant in Huizhou City. That site also added capacity for linear alpha olefin production and will expand capacity further by 2028.

China accounts for development of mostly high‑viscosity PAOs used in gear oils and industrial lubricants. PetroChina’s Lanzhou facility is reported to be the first low‑viscosity PAO plant in the country, producing products with performance metrics comparable to imported grades in terms of viscosity index, pour point, flash point and low‑temperature dynamic viscosity. Despite that development PAO remains a small segment of global base stock production at less than 1% according to industry sources.

PAO base oils maintain advantages under low temperature and high shear conditions where mineral oils may not deliver equivalent film strength or cold‑start protection in automotive applications. The molecular consistency of PAO gives it uniform behavior that aids in performance predictability. The fluids do not require dewaxing during manufacture since their structure resists wax crystallization. Earlier low-viscosity PAOs exhibited moderate viscosity index values but modern grades made with metallocene catalysts offer improved oxidative performance and pour point resistance.

Cost remains a limiting factor. PAOs are more expensive than Group III and much more costly than mineral oil grades. Adoption depends on whether formulators receive price premiums for performance or emissions reduction benefits. PAO production is more complex and feedstock competition exists since linear alpha olefins are also used in detergent manufacturing. This limits global capacity growth and confines production to firms with olefin polymerization expertise.

Despite price pressure, synthetic demand remains in applications such as wind turbine gear oils hydraulic fluids industrial compressors and specialty automotive lubricants. PAO fluid use in these sectors continues to support long term viability for this product class while maintaining a niche position. Growth prospects are tied to industrial expansion regulatory demands for high-performance and energy-efficiency trends globally.

Producers

Apalene Technology
CNOOC & Shell Petrochemicals Co. (China joint venture)
Dowpol
Dowpol-Lu’an
ExxonMobil Chemical
Ineos Oligomers
Lanxess
Lu’an Group
PetroChina
Shanghai Fox Chem.
Taif Group

Group V

Other types of synthetic base stocks are classified as Group V and include synthetic esters, polyalkylene glycols, polyisobutenes and silicones.

The synthetic base oil market is niche. Demand for ester base stocks is growing in sectors where biodegradability or nonflammable characteristics are prioritized. In 2019 esters accounted for more than two‑thirds of base stocks used for biobased lubricants. Volume remains small but grows mostly in environmentally regulated sectors. Ester technology is evolving to address previous limitations such as hydrolytic instability through molecular design that enhances stability and performance.

Emerging ester chemistries offer new functional benefits. VBASE Oil Company has developed secondary polyol ester base oils that retain biodegradability while improving deposit control friction reduction and thermal stability. These products span ISO viscosity grades 32 to 460 and provide hydrolytic resistance superior to traditional esters due to their ester and ether bond architecture and branched backbone. Other fluid innovations include estolides produced by Biosynthetic Technologies derived from castor and soy that deliver oxidative and wear performance comparable to petroleum base oils.

PAGs continue to be used mainly in industrial applications where their polarity and lubricity excel in extreme environments. Dow Chemical’s Ucon fluids are widely used in compressors and refrigeration systems. Dow operates multiple PAG plants including Tarragona Spain Freeport Texas South Charleston West Virginia and a joint venture in Malaysia. Combined output reaches nearly 246,000 tons annually. PAG demand persists in industrial markets especially in India China Europe and North America where compressor warranties or low temperature operations drive performance requirements.

Cost and compatibility remain challenges. Esters typically cost more than Group III or PAO base oils. PAGs are incompatible with many seal materials and cannot be blended easily with mineral or other synthetic oils which limits application flexibility. Ester hydrolysis may cause acid formation seal corrosion sludge or varnish if not formulated correctly.

Applications where synthetic base stocks dominate include aerospace gear oils metalworking fluids environmentally acceptable lubricants and electric vehicle coolant fluids. Ester technology supports lubricant formulation in sectors pursuing thermal and environmental performance. PAGs offer performance in conditions unsuitable for mineral oils such as low temperature compressors and food machinery scenarios. Together these fluids support equipment reliability regulatory compliance and reduced environmental impact while filling gaps that mineral and PAO fluids cannot address.

Growth for Group V synthetic base stocks is expected to continue where performance requirements intersect with regulatory or sustainability mandates. Capacity expansion by specialist ester producers and continued PAG investment by major industrial suppliers will shape the future of these products. Despite limited volume compared with other base stocks, Group V synthetics provide essential functional value in niche but expanding markets.

Synthetic Esters

• Manufacturing Process:
  • Produced by reacting carboxylic acids with alcohols.
• Properties:
  • Thermal resistance
  • Oxidation stability
  • Low volatility
  • Biodegradability
• Applications:
  • Hydraulic systems
  • Aviation greases
  • Compression systems
  • Environmentally acceptable lubricants (where residue control, fire resistance, or biodegradability are required)

Producers
Biosynthetic Technologies
Lanxess
Matrica
NOF Corp.
Nouryon
Nyco
Oleon
OQ Chemicals
Patech Fine Chemicals
Perstorp
Peter Greven GmbH
Savita Oil Technologies 
Shin-Nihon Rika
Stearinerie Dubois
Teknor Apex
Vantage Specialties
VBASE Oil Company
Wellnj
Youmi Chemical
Zschimmer & Schwarz

PAGs

• Manufacturing Process:
  • Made by polymerizing ethylene oxide or propylene oxide with alcohols or water to form glycol chains.
• Properties:
  • High viscosity index
  • Excellent lubricity
  • Polarity
  • Temperature stability
• Applications:
  • Food-grade lubricants
  • Quenching fluids
  • Compressor oils
  • Gear and chain lubricants
  • HFC hydraulic fluids

Producers
Adeka
BASF
Clariant
Croda
Dow Chemical
Ethox
Geo Specialty Chemicals
Idemitsu
Ineos Oligomers
Nalco
Pan Asia Chemical
Pelron Corp.
Petronas Chemicals
Sanyo Chemical
Solvay
Vantage Specialties
Vladimir Chemical
Wellnj

PIBs

• Manufacturing Process:
  • Produced by polymerizing isobutene, which is then further processed into various grades of PIB.
• Properties:
  • Excellent tackiness
  • Good film-forming ability
  • Oxidation and thermal stability
  • Water resistance
  • Low toxicity
• Applications:
  • Viscosity modifiers in engine and industrial oils
  • Tackifiers in adhesive formulations and lubricants
  • Fuel additives (e.g., detergents and dispersants)
  • Sealants and caulks
  • Cable insulators and packaging materials
    
    Producers
    BASF Petronas Chemicals
    BASF-YPC
    Braskem
    Chevron Oronite
    Daelim Industrial Co.
    Eneos
    Gujarat Polybutenes
    Ineos Oligomers
    Infineum
    Jilin Chemical (CNPC)
    Jinzhou Jinex Lub. Add.
    Kochi Refineries (BPCL)
    Kothari Petrochemicals
    Lubrizol
    NOF Corp.
    Shandong Hongrui New Material
    TPC Group
    YPF

Phosphate Esters

• Manufacturing Process:
  • Produced by reacting phosphorus oxychloride (POCl₃) or phosphoric acid with alcohols or phenols to form triaryl or trialkyl phosphate esters.
• Properties:
  • Excellent fire resistance
  • Good oxidative and thermal stability
  • High load-carrying capacity
  • Low volatility
  • Poor hydrolytic stability (especially in the presence of water)
• Applications:
  • Fire-resistant hydraulic fluids (especially in aerospace and power generation)
  • Plasticizers in polymers
  • Base stocks for high-temperature lubricants
  • Anti-wear and extreme-pressure additives in lubricants
  • Aircraft turbine engine lubricants

Producers
Clariant
Daihachi Chemical
ICL Industrial Products
Lanxess
Mitsubishi Gas Chemical
Prasol
Protex
Showa Ether
Solutia (Eastman)
Tianjin Binhai Chemicals
Tina Organics

Silicone Base Oils

• Manufacturing Process:
  • Synthesized by hydrolyzing and polymerizing chlorosilanes (typically dimethyldichlorosilane) to form polydimethylsiloxane (PDMS) and other organosilicone polymers.
• Properties:
  • Excellent thermal stability
  • Wide operating temperature range
  • Low surface tension
  • High oxidation resistance
  • Chemically inert
  • Water repellency
  • Electrical insulating properties
• Applications:
  • High-temperature lubricants
  • Dielectric fluids in electronics
  • Release agents (e.g., in molding and plastics)
  • Water-repellent coatings
  • Damping fluids in instruments and shock absorbers
  • Personal care products (e.g., skin and hair formulations)

Producers
Dow Corning
Elkem Silicones
Evonik
Evonik Goldschmidt
Momentive Performance Materials
Shin-Etsu Chemical
Wacker Asahikasei Silicone
Wacker Chemical