Market Topics



EU to Tax Group II?

A tariff exemption for API Group II base oil imports to the European Union is set to expire in December, and a committee is considering whether to renew, amend or abolish the waiver.

The Union of the European Lubricants Industry and the United Kingdom Lubricants Association both favor a prolonged suspension of the duty, but the European Commission, the EUs decision-making body, is leaning toward a 400,000 metric ton quota on the annual volume of base oil imports that can enter the EU without a tariff. Various EU member states and the UEIL have urged that a significantly higher volume be set, should a quota come to pass.

Group II base oils are among a group of products that have been subject to an import duty of 3.7 percent since 2016, but the tariff has been temporarily suspended for Group II.

The tariff waiver came under scrutiny after the opening earlier this year of Europes first large Group II plant-the 1 million metric tons per year ExxonMobil facility in Rotterdam.

Lube blenders and industry groups contend that ExxonMobils plant does not come close to meeting the trade blocs Group II needs, which UEIL puts at some 1.85 million tons in the EU and Turkey combined.

Shell, CISA Form JV in Mexico

Shell Lubricantsand Comercial Importadora S. de R.L. de C.V. announced a joint venture partnership in Mexico. It includes investments in existing facilities, increased lubricant production capacity, new marketing capabilities and local workforce training and development.

The j.v. will operate under the name CS, Juntos Shell y Quaker State Mexico and will be the sole licensee, producer and marketer ofPennzoil-Quaker Stateproducts and other Shell lubricant brands in Mexico.

CS aims to strengthen its position in automotive lubricants in Mexico by expanding its Naucalpan lubricants plant and increasing production capacity. Reports by multiple Mexican news outlets in early August said the investment in the Naucalpan plant would range from $4 million to $7 million per year over the next five years-totaling between $20 million and $35 million over that time-to expand the plants annual blending production capacity by about 50 percent from its current capacity of about 108,000 metric tons.

New York Settles over Obsolete Oils

The New York Attorney Generals Office announced that it reached a $1.1 million settlement with Dollar General Corp. regarding the sale of obsolete motor oils. The case involved concerns about Dollar Generals labeling and placement practices for store-brandedAPISF and SA motor oils, which have both been declared obsolete by the American Petroleum Institute.

The settlement stated that Dollar General failed to post either on the shelves or the front of bottles that the products were unsuitable for use in most gasoline powered automobile engines built in the past three decades, and the state was not satisfied by a real label advisory.

The settlement is separate from a class-action lawsuit brought by 16 other states claiming that Dollar Generals cheaper, obsolete motor oils can damage modern vehicle engines.

Opet-Fuchs JV Opens Turkey Plant

Opet-Fuchs-a joint venture between Fuchs Petrolub and Opet Petrolculuk-began operations at a new lubricants blending facility in Izmir, Turkey. The plant has capacity to produce 60,000 metric tons of lubricants per year.

According to Fuchs, the facility will manufacture a range of products, including engine oils, industrial oils and special products. It also has a research and development laboratory attached, with the capacity to apply more than 100 test methods with more than 45 testing devices.

Opet-Fuchs first announced the construction of the facility in 2012. The 55,000-square-meter plant cost $26.3 million, a press release stated.

Mobil Repositions in Argentina

ExxonMobilis working to reposition its Mobil brand in Argentina where it recently signed Cosans Moove to serve as distributor.

The companys goal is to increase its lube product offerings in the region to cover cars, motorcycles and other transportation modes.

ExxonMobil currently has only a sliver of Argentinas market, according to Brazilian consultancy LubeKem.To regain market share, Mobil now has a total of 11 distributors throughout Argentina offering a variety of products. Among them are Mobil Delvac for trucks and agricultural machinery, Mobil Super for cars, Mobil Super Moto for motorcycles and Mobil for industrial lubricants and greases.

Briefly Noted

Motiva will acquire Flint Hills Resources chemical plant in Port Arthur, Texas. The plant is located next to Motivas oil refinery.

Ingevity has expanded its metalworking fluid products distribution in the European market through existing partnerships. Carroux mbH distributes in Germany and will expand into Eastern European countries, while Sea-Land Chemical Co. covers the United States and will expand its sales into Western Europe.

Valvoline Inc. announced its franchisee, Galena, acquired five quick-lube locations in New Jersey that are now operating as Valvoline Instant Oil Change service centers. Valvoline also bought Calgary, Canada-based quick-lube chain Minit Lube, acquiring six stores.

ExxonMobil Chemical Co.appointedSynergy Additives Co. as its distributor of API Group IV and Group V synthetic base stocks in Mexico, Central America and the Caribbean.

Kingsport, Tennessee-based Eastman Chemical Co. selected Univar Solutions to distribute the companys Turbo Oils and Skydrol aviation hydraulic fluids to the military aviation market.

Faces in the News

Jeremy Baines became president of Neste U.S. on September 1.

Tim Langlais is now director, strategy & growth at Calumet. He previously worked for Solomon Associates.

Songwon CEO Maurizio Butti died on September 7. Jongho Park is acting CEO.

Erick Contreras took over as managing director of BASF Vietnam Co. Ltd. on September 1, succeeding Tanachart Ralsiripong.

Monson named Rick Plasencia as west coast account manager.

Wirat Uanarumit was appointed president and CEO of Thai Oil Public Co. Ltd. on September 1.

Joseph Maslowski, chief operating and chief financial officer at Roetzel and Andres, joined the Biosynthetic Technologies Board of Directors.

Related Topics

Market Topics