In recent years, significant changes have altered the once familiar landscape of the base stock market. With the arrival of premium grades, synthetic cuts and re-refined base oils, the topography was transformed forever.

Producers also started to modify their product slate, with some of them venturing into areas they had only dreamt about in the past.

One of the most talked-about headlines in early November was the announcement that API Group I producer HollyFrontier would be acquiring Petro-Canadas lubricants business, including the companys Mississauga base oil plant, which can produce 11,600 barrels per day of Group II oils and 4,000 barrels of Group III grades.

Through this smart acquisition, the producer not only gains access to production of Group II/III base oils, but also of white oils, waxes, specialty fluids, greases and finished lubricants, making it a very complete and integrated operation.

Last year, HollyFrontier had shelved its plans to build a new base oil plant in Woods Cross, Utah-to include Group III production-and it appears that the project has now been cancelled altogether.

In contrast to these interesting business changes, on the pricing front, November brought no posted price revisions for paraffinic oils.

In the naphthenics sector, a serene setting had been observed since May, until a domestic supplier announced a 10-cent-per-gallon increase the first week of November.

The hike was heard to be driven by gains in crude oil values compared to earlier in the year, which had resulted in base oil prices falling out of alignment with production costs.

Also in the fourth quarter, a large naphthenic and paraffinic producer ushered in some changes to the supply panorama, with Ergon starting to commercialize additional bright stock from its upgraded Vicksburg, Mississippi, plant in October.

Through this addition, Ergon became the second largest Group I bright stock producer in the world at a time when much bright stock production has disappeared.

The evolution of base oils reflects the changing needs of downstream applications, and the metamorphosis will not only continue, but likely accelerate in the near future.