Gulf Oil Middle East outlined a 40 million dirham (U.S. $10.9 million) plan Monday to expand its U.A.E. blending capacity from 50,000 to 200,000 metric tons per year, driven by strong demand for industrial and automotive lubricants.
The Middle Easts lube oil sector is as robust and dynamic as ever and has continued to support the industrial development in the region, V. Ramesh Rao, general manager and CEO of Gulf Oil Middle East Ltd., said in a statement. Gulf Oil commands 8 percent of the regions lube oil market, and we are keen to increase that share by more than 12 percent in the next two years. Rao expected the main demand to come from the industrial, energy and marine sectors.
He noted that lubricant demand in the Gulf Cooperation Council states was expected to grow at 6 percent a year. By increasing capacities at our Jebel Ali unit 1 and unit 2 facilities [in Dubai], we can easily satisfy regional requirements, Rao said.
Kline & Co.s report, Lubricant Basestocks in Africa and the Middle East 2010: Market Analysis and Opportunities, projected finished lubricant demand and overall base stock demand in the Middle East to grow at about 2.7 to 3 percent per year from 2009 to 2019.
Kline estimated finished lubricant demand in Africa and the Middle East at 3.5 million metric tons in 2009. The top markets included Iran (20 percent), United Arab Emirates (16 percent), Egypt (11 percent) and Saudi Arabia (9 percent).
Automotive markets accounted for close to 75 percent of the total demand in Africa and the Middle East in 2009, Kline found, including 42 percent heavy duty motor oils, 25 percent passenger car motor oils and 8 percent other automotive lubricants. General industrial oils accounted for about 13 percent of product demand, and industrial engine oils 3 percent in the region.
Gulf Oil Middle East Ltd. is a subsidiary of Gulf Oil International, with its main factory in Jebel Ali Free Zone in Dubai in the U.A.E. It handles Gulf Oil operations in the Middle East region, manufacturing and marketing lubricating oils, greases, brake fluids, coolants and other automotive specialties.