India Base Oil Capacity Set to Double 


India’s national oil companies are expected to more than double their total base oil capacities to 2.91 million metric tons per year by 2028, a Hindustan Petroleum Corp. Ltd. official said at the ICIS Asian Base Oils and Lubricants Conference in Singapore.

India, a country of 1.42 billion people with a vehicle parc of about 326 million, consumed about 4.1 million t/y of base oil in 2023-2024, up from 3.7 million tons in 2022-2023.

Currently, the total base oil capacities of four national oil companies is 1.41 million t/y and new base oil capacities are expected from this year. Indian Oil Corporation is expected to add 240,000 t/y by 2024, 230,000 t/y by 2025 and 540,000 t/y by 2026. Upon completion, the company will have a total capacity of 1.25 million t/y making it the largest base-oil-producing NOC.

“New capacities will significantly reduce Group II and Group III imports, particularly 150N and above,” said HPCL Executive Director for Lubricants Sanjay Kumar. “Bright stock supplies is expected to remain tight and low viscosity grades imports from Korea will continue.”

Hindustan Petroleum Corporation will increase its capacity from 500,000 t/y to 750,000 t/y by 2028. Chennai Petroleum Corporation will double capacity to 480,000 t/y by 2028. Bharat Petroleum Corporation’s capacity will remain at 430,000 t/y.

Kumar said that “with expansion plans underway, national oil companies will aim to secure base oil sales and surge in supplies is expected to create pricing pressures. In case of surplus availability, NOCs may offer some spot export cargo.”

Import of base oil increased from 3.476 million tons in 2022-2023 to 3.687 million tons in 2023-2024. Most of the growth was from API Group II which increased 1.1% to 1.52 million tons. Import of Group I fell 0.2% to 511,000 tons and Group III fell 0.1% to 954,000 tons. The top-three biggest importers were Savita Oil Technologies Ltd., Apar Industries Ltd. and Raj Petro Specialities Private, a member of Germany’s Brenntag Group.

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