In addition to U.A.E.s 1.25 million t/y, Kumar estimated lubricant blending capacity in other Middle East nations to be: Iran, 800,000 t/y; Saudi Arabia, 700,000 t/y; Syria and Iraq, 200,000 t/y each; Jordan, 100,000 t/y; Yemen, 80,000 t/y; Kuwait, 60,000 t/y; Qatar and Oman, 40,000 t/y each; and Lebanon, 12,000 t/y.

Because regional base oil demand is more than twice current production levels, base oil is imported into the region, with API Group I coming from Saudi Arabia, Iran, Far East, Europe and CIS. Group II comes from Korea, India and Far East, while Group III comes from Korea and Malaysia, said Kumar. The region anticipates nearly 2.7 million t/y of new base oil production from six new units over the next five years, including four new plants in the Middle East itself, all Group II or III quality.

Although it has no base oil refining capacity, U.A.E. is the main hub for base oil imports and re-exports in the region, said Kumar.

The area will be flooded with Group II and III, he went on. By 2015, I would like to use GTL [gas-to-liquids].

U.A.E.s domestic lubricant market is relatively small in size, but high in quality, Kumar said. The total domestic market is now about 110,000 tons, excluding exports and offshore marine oil supply. The recession had a severe effect; lube production peaked at 135,000 tons in 2008, and fell to current levels last year.

Over 90 brands of lubricants are sold in U.A.E. Kumar estimated market shares to be Eppco (Enoc and Caltex), 23 percent; Total, 15 percent; Adnoc, 14 percent; Shell, 13 percent; Elco, 11 percent; Mobil, 10 percent; Emarat, 3 percent; and all others, 11 percent.

Most lubricants sold in U.A.E. are automotive, Kumar continued. Diesel engine oils make up about 35 percent of the market; passenger car engine oils, 30 percent; specialties (including coolants, brake fluids, compressor oils, turbine oils, industrial gear oils, machine oils, etc.), 24 percent; hydraulics, 14 percent; transmission oils, 4 percent and greases, 3 percent.

U.A.E. continues to be a quality driven market compared to other markets in the region … [and] is the pace-setter to introduce new technology products in the region, said Kumar.

Export volumes from U.A.E. are very large, but there is no data, he continued. The nation produces low-quality lubes for export. With over 1.2 million t/y of blending capacity and just 110,000 t/y of domestic demand, export volumes could indeed be huge.

Thanks in large part to the Emirates Authority for Standardization & Metrology, or ESMA, a government agency, the minimum gasoline engine oil standard in U.A.E. is API SJ, and the minimum diesel standard is CF. ESMA has proposed manufacturing surveillance for quality assurance, and plans to implement a lube oil market monitoring scheme throughout the seven emirates to upgrade oil quality standards, Kumar said. In addition, ESMA-approved oils will display an ESMA quality assurance logo.

The nation has already limited older vehicles on the roads, including a ban on taxis older than five years and a ban on imports of light vehicles older than five years and heavy vehicles older than seven years, in order to boost the use of high quality lubricants and reduce pollution, Kumar said.

Kumar noted that his own company, part of the government-owned Enoc Group, manufactures lubricants at the Fujairah seaport, the worlds second largest marine fuel and lubricant bunkering facility after Rotterdam. The Enoc Fujairah plant has capacity to blend 100,000 t/y of lubricants and 5,000 t/y of greases, with 15,000 tons of base oil storage and 10,000 tons of bulk finished product storage.

Demand for synthetics is rising in U.A.E., and multigrade oils are becoming more popular due to the shortage of bright stocks, Kumar concluded. In the Middle East, we believe the thicker the oil, the better. But this perception has to change. Life would be boring without challenges.