U.S. Lube Sales Slid in Early 2007

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Total U.S. lubricant sales volumes in the first quarter of 2007 fell 5.7 percent from the same period of 2006, according to data released by the National Petrochemical and Refiners Association.

Released on June 11, the NPRAs Quarterly Index of Lubricant Sales showed that the first quarter decline was led by grease sales, which saw an 11.7 percent drop in volumes compared to the year-ago quarter.

In the automotive lubricant segment, sales volumes slipped 6 percent, industrial lubes were off by 5.7 percent and process oils dippedby 4.5 percent.

There were a lot of turnarounds this quarter, and some took longer than expected, said NPRA technical programs manager Daniel J.Strachan, who is in charge of all lubricant and wax statistics at the association. Turnarounds include maintenance, upgrades, inspections, systems, hardware (at the plants) and this puts everything on hold.

The NPRA member companies that report quarterly data are all refinersas well as marketers; they represent over 72 percent of the lubricant volumes reported for NPRAs more comprehensive annual report on lubricating oil sales.

The associations report also summarized the U.S. Department of Energy quarterly statistics, which showed a rise in paraffinic and naphthenic base oil manufacturing production and a drop in wax production.Overall,first-quarter 2007base oil output was 14.88 millionbarrels, an increase of 2.1 percent over the first quarter in 2006. Paraffinic base oil production totaled 12.35 million barrels, and naphthenic totaled 2.53 million barrels. Wax production was reported at 1.23 barrels, a drop of 1.8 percent compared to the year-ago quarter.

The quarterly NPRA report does not report lubricant sales volumes; rather, it reports index values, using 2002 as the base year. An index value of 100 represents the average quarterly volume for 2002. The 2007 first quarter index value was 89.9 — that is, sales were 89.9 percent of the 2002 average — compared to 95.4 for the first quarter of 2006.

The automotive lubricant index was 91.1 for the first quarter of 2007 (vs. 96.8 in 2006); the industrial lubes index was also 91.1 (vs. 96.6); grease was only 73.7 (vs. 83.5 a year ago); and industrial process oils were 85.8 (vs. 89.8).

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