London — SAE 0W lubricants are projected to become the fastest-growing light-duty engine oil segment over the next decade across Europe, North America and North Asia, with emerging markets such as India also contributing to demand expansion, according to Chevron.
Speaking at the Argus Global Base Oil Conference earlier this month, Luyen Vo, senior manager of global technical sales and business development in Chevron’s base oil division, said tightening fuel economy standards and evolving engine designs are accelerating the shift toward lower-viscosity lubricants.
Vo said that SAE 0W-XX grades are increasingly specified to help meet regulatory requirements and original equipment manufacturer (OEM) performance targets, particularly as environmental regulations continue to tighten globally.
Global API Group III base oil capacity is expanding in response to rising demand for high-performance, low-viscosity lubricants.
Much of the new capacity growth is concentrated in Asia-Pacific, especially China. North America is also seeing strategic additions, including a planned 2028 expansion by ExxonMobil and the addition of Group III+ production to Chevron’s base oil slate in Pascagoula, Mississippi.
Vo said this structural shift toward higher-performing base stocks is expected to increase global demand for premium grades and intensify competitive dynamics within the Group III segment. She advised base oil producers to review their portfolios to ensure long-term resilience as specifications continue to evolve.
Europe continues to post the highest Group III prices globally, according to Gabriella Twining, global editor of Argus’ base oils reporting.
Twining attributed the premium to the region’s status as a net importer and to stringent product approval requirements that limit supply flexibility.
Logistical disruptions have added further pressure. Group III cargoes bound for Europe have been rerouted to avoid the Suez Canal amid security concerns linked to instability near Yemen, extending transit times and tightening regional availability.
Vo also emphasized the importance of supply security and strategic flexibility amid geopolitical instability, economic volatility, climate-related pressures, technological shifts and other global disruptions.