Most major oil companies notified U.S. customers of finished lubricant price mark ups that go into effect from early February to early March, the majority citing increases in base oil, additives and packaging costs.
- On Dec. 15, Chevron told customers it would bump prices up 5 percent on lubricating oils, gear lubes and greases. Some specific products could increase in amounts outside of the general increase, the companys letter pointed out.
- ConocoPhillips told customers Dec. 21 it would hike prices for finished lubricant products 5 to 8 percent starting Feb. 1, depending on product-specific factors. The increase is being driven by recent increases in base oil, additives and packaging costs that have occurred despite our best efforts to limit their impact on our product manufacturing, its letter explained.
- ExxonMobil notified customers Jan. 3 it would raise prices for its branded and unbranded lubricants and greases by up to 8 percent effective Feb. 1. Different price treatment may apply to selected products, the company said in its letter.
- Citgo notified customers Jan. 3 it would raise prices 5 to 8 percent on Citgo, Mystik, MileMaster and private label bulk and packaged finished lubricants and greases, effective Feb. 3. In a Jan. 5 letter, Citgo said it would increase prices 4 to 8 percent on Clarion bulk and packaged white mineral oils, lubricants and greases, effective Feb. 3. The increase is driven by escalations in base oil, additive and packaging material costs that have occurred over the past several months, each of Citgos letters stated.
- Shell on Jan. 7 informed customers of price increases up to 8 percent effective March 1. This adjustment is due in part to increasing costs of raw materials used in the production and delivery of our products, the companys letter noted.
A distributor expressed concerns about the economic ramifications of the finished lubricant price increases. Although people expect it because they see whats going on in the news with the pricing on crude and they see the pump prices going up, it is going down a little tough this time around because the economy is still in the fragile state that its in, this source told Lube Report. I think its definitely going to help slow any blips of hope that we were seeing in regards to any type of nominal recovery.
This source suggested changes in the base oil market overseas might also play a key role in finished lubricant price changes in the United States. With the emerging economies in China and India, their demand for some of the base stocks is having a greater impact than it has historically on whats going on here. And therefore that reflects I think to a large degree in the latest round of increases that were seeing.
An official with a lubricant blender noted to Lube Report, its been a while since weve had an across the board additives increase, and certainly base oils are up.
The amounts this time certainly cover the increases theyve had since the last one, plus a little bit, this source added. I dont know when the additive companies are going to raise their prices again, but Im sure its going to happen. If you look at the chemical market, its up twice a month sometimes.
A variety of other blenders have also informed customers of price increases.
- Safety-Kleen on Dec. 9 told customers the prices on its rerefined finished lubricant products would rise 6 to 13 percent on all shipments made on or after Feb. 13.
- On Dec. 7, Cross Oil informed customers of 10 to 15 percent price increases on all lubricating oils, gear oils and greases, effective Dec. 17 for bulk lubricants and Jan. 7 for packaged lubricants. Cross cited “the continued rapid rise in the cost of raw materials” in its letter.
- Cam2 told customers it would raise prices 6 to 10 percent on bulk orders placed after Dec. 24 and packaged orders placed after Jan. 1, depending on product classification. Its Dec. 8 letter pointed out that raw material and freight costs continue to escalate.
- Bioblend on Dec. 27 advised customers of price increases averaging 5 to 8 percent effective Jan. 17 throughout its line of biodegradable and food grade lubricants. Recent increases in the cost of base oils, additives and packaging have contributed to an overall cost increase for BioBlend products, its letter observed.
- Omnova Solutions on Feb. 1 will bump up prices 8 cents per wet pound on list and off-list prices for SunKote calcium stearates, Sunkem polyethylenes and Omnaglide lubricants used for paper and paperboard. The prices hikes were necessitated by escalations in the costs of key feedstocks, said Omnova of Fairlawn, Ohio.