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Lube Production Stalls in Russia

Russian lubricant production stagnated in 2013 because of an economic slowdown and a weak ruble, and it is forecast to stay sluggish through 2016, according to an industry consultant.

In 2013, Russia produced 2.3 million metric tons of base oils and lubricants combined, the same volume as in 2012, according to InfoTek, a Moscow-based consultancy. Base oils accounted for 63 percent of the volume, while finished lubricants made up the remaining 37 percent, Boris Sobolev, head of InfoTeks oil refining and petrochemicals research department, told GBCs Lubricants and Fuels Conference in May.

Last year, Lukoil retained its position as top lubricant producer in Russia, holding a 47 percent share of lubricant production, Sobolev said. Next in line were Rosneft with a 26 percent share, Gazprom Neft at 19 percent and Bashneft at 8 percent.

InfoTek found that Russia produced 862,000 tons of finished lubricants in 2013. Motor oils accounted for 63 percent of the total while industrial oils held a 16 percent share. The rest goes to transformer oils (15 percent) and transmission oils (6 percent), Sobolev said.

In 2013, motor oils produced in Russia were consumed mostly by the automotive sector (23 percent) and by tractor and agricultural machinery (50 percent). The shipping transportation and aviation sectors consumed 23 percent and 2 percent, respectively. These motor oil volumes [didnt meet] the countrys motor oil demand, and they [were supplemented] by imports, Sobolev said.

Last year, finished lubricant imports into Russia totaled 495,000 tons. According to InfoTek, 62 percent of motor oil demand, 59 percent of transmission oil demand and 27 percent of hydraulic fluid demand was met by imports. The consultancy expects better results for base oil and lubricant exports, predicting an increase from 1.2 million tons in 2012 to 1.6 million tons by 2018.

Russia consumed 53,000 tons of lubricant additives in 2013, and its domestic additive production stood at 36,600 tons. Of this production, the country exported 2,500 tons, Sobolev said. The top three domestic producers were Rosneft, the LLK-Naftan Russo-Belarus joint venture, and independent additive manufacturer Qualitet. Last year Rosneft and LLK-Naftan accounted for 26 percent and 25 percent of domestic additive production, respectively, while Qualitet held almost 20 percent of the total, according to InfoTek.

The quality of Russian additives is not sufficient for the production of premium quality oils, Sobolev indicated, citing this as the reason why so much of the countrys additive consumption is based on imports – 19,000 tons in 2013. Infineum led imports with a 39.5 percent share, followed by Lubrizol at 27.8 percent, Afton with 16 percent, Evonik at 12.1 percent and Chevron Oronite at 4.5 percent.

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Europe    Finished Lubricants    Region