Despite the reductions, he said, most distributors feel they should still see more relief in finished lubricant prices than they have so far. We need more decreases and the majors have to follow along, or youre going to see more erosion of the majors at everyones quick lubes and dealerships, the source said. All of us [distributors] have majors, and we need to keep our volume up – its hard to do that when theyre not competitive.

Chevron Products Co. in a letter Monday advised customers it would decrease prices for lubricating oils by up to 8 percent for bulk and packaged products effective Jan. 12. Product lines excluded from the decrease include greases, food grade oils, synthetic oils now under allocation, coolants and fuel additives. In addition, from Dec. 8 through Jan. 9 a price adjustment, via a manual credit, in the same amount of the posted price decrease will be implemented to allow for immediate benefit of this price increase, the company stated in its notice.

ExxonMobil on Monday informed customers that it would decrease prices by 48 cents per gallon for the majority of ExxonMobil branded and unbranded conventional, mineral-based lubricants and greases effective Dec. 8. It includes pending orders – ordered, but not yet shipped – placed prior to Dec. 8. The price action excludes all synthetic products, the company advised customers in its letter.

Shell on Dec. 1 told customers of plans to decrease list prices for lubricants by up to 8 percent, reflecting a general decrease of 44 cents/gal for conventional oils and 48 cents/gal for full synthetic products. In the notice, the company said decreases would go into effect Dec. 1 for bulk products, and Jan. 5 for packaged products.

In its letter, Shell noted 2008 has been unpredecented in recent history, with crude oil prices rapidly escalating to record levels, followed by a similarly rapid decline over the past two months. Although we are beginning to see base oil softening, we do not expect to see base oils decline in the same manner, Shell said. Base oil price escalations throughout the summer were primarily associated with supply tightness, culminating with sales controls and allocations due to impacts of Hurricanes Gustav and Ike. Base oil prices are softening, as supply returns to a more balanced position in the U.S. However, additives remain at escalated levels, with select products receiving additional increases.

Citgo on Nov. 25 stated it would drop prices by 50 cents/gal or 5 cents per pound effective Dec. 1 for Citgo and Mystik branded finished lubricant products – with some exceptions – in all package configurations including bulk. Automotive gear oils will decrease by 28 cents/gal, while synthetic industrial oils, fire resistant fluids and the Clarion brand are excluded from the price change.

ConocoPhillips on Oct. 21 told customers it would lower prices for most finished lubricants products by 30 cents per gallon effective Oct. 24. The major driver for this decrease is the reduction in crude oil prices and the anticipated reduction in other component costs, the company explained to customers. While base oil and other component imbalances still exist in the market, our inventory situation provides flexibility to make the move at this time.

North American Lubricants last week informed customers of a price reduction of 50 to 70 cents/gal on most of its finished lubricants for orders placed on or after Dec. 3, citing a softening of raw material costs. NAL said the reduction was made possible by the improvement in U.S. base oil production and inventories, which had struggled to return to normal levels after experiencing substantial supply interruptions caused by Hurricanes Gustav and Ike.

Tight base oil inventory levels and record base oil crack spreads – refiner profit margins – delayed softening of finished lubricant prices as crude oil values steadily declined, NAL said in a statement. As the base oil markets volatility appears to be subsiding, additive, transportation and packaging costs remain at escalated levels.

After the unprecedented volatility we have seen in 2008, a little good news goes a long way, NAL president Shane Terry said.

I feel you will see other companies that moved at the start like ConocoPhillips and American Refining Group move again real soon, an official with a northeastern distributor said. The market is screaming for it, and the one that doesnt listen will be the one to lose market share.

I believe we will see another significant decrease announced in January 2009 by the majors, an official with a southern distributor opined.

I think theyre slightly overdue, a western lubricant blender said of the price decreases. I think a lot of people were waiting, thinking the additives were going to come down in price. I dont think thats going to happen until after the first of the year.

This official suggested the price decrease was unlikely to immediately spur demand for finished lubricants. I think theres a lot of people, unfortunately, that still have a lot of expensive inventory to get rid of, the source said. Having decided to do that, I dont think theyre going to want to take too big of a loss. But the longer they wait, the bigger loss theyll have to pay. Its hard to say whats going to happen, with the economy in such bad shape.