Base Oils Outlook Now and Later
The world’s base oil markets have reached a critical junction. With the option to go down any number of paths, the decisions made by refiners, producers, traders, distributors and blenders of finished lubricants will affect the direction and progress of the base oil scene for years to come.
The global base oil scene has been subjected to the most onerous period in the history of the industry. Having weathered a pandemic, which was accompanied by lockdowns and government restrictions on movements of goods in many countries, the industry experienced a downturn in demand for almost all consumer products. This was followed by an unprovoked invasion of Ukraine by Russia, which has led to a European war that has no end in sight.
Sanctions imposed by Western allies, such as the EU and other likeminded nations, have led to inflated energy costs. When added to the COVID-induced global recession, the base oil industry is looking at the perfect storm.