Traditional basestock markets are stagnating, while developing markets are expanding, and new applications like Immersion Cooling pres- ent fresh opportunities.
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Anuj Kumar, Industry Expert at Kline + Company
Sustainability Drivers
The industry is currently facing a pivotal shift towards sustainability in products and practices. There are numerous strategies available to achieve this goal, yet the imperative to adapt is unequivocal. Delay in embracing sustainable measures will undoubtedly place companies at a competitive disadvantage.
Electrification Trends
With the increasing penetration of electric vehicles (EVs), the demand for finished lubricants, particularly Passenger Car Motor Oil (PCMO), is anticipated to decline over the long term. This raises a critical question for lubricant blenders and basestock marketers: how should they prepare to pursue growth in this evolving landscape?
Market Dynamics
The dynamics within the mass market, primarily consisting of Group II and Group I basestocks, present a contrasting picture. Group I is striving to maintain its market share amidst declining demand and supply, whereas Group II is aiming to expand its presence despite facing significant surplus capacity.
New Applications
The exploration of new applications, such as immersion cooling for data centers, energy storage, and electric vehicles, presents potential avenues for growth. Identifying which basestocks are best positioned to benefit from these emerging opportunities is crucial for future success.
Basestocks Intelligence Center. The most comprehensive coverage of the basestocks industry.
The various components of the BIC include:
Conventional
Basestocks:
Customizable online models for analyzing market scenarios, covering Group I, Group II/II+, Group III/III+, and naphthenic basestocks globally.
Synthetic
Basestocks:
Analyze the demand and market outlook for synthetic basestocks, including Group III, Group III+, Polyalphaolefin (PAO), synthetic esters, Polyisobutylene (PIB), polyalkylene glycol, phosphate esters, and more.
Sustainability-
Focused Basestocks:
Get an overview of regulations, a capacity map of re-refineries, and country-level material balances for used oil, emphasizing sustainable practices within the industry.
Market Monitor:
Keep informed about market developments and key players with profiles of leading basestock marketers, curated industry news, product specification sheets, and a database of finished lubricant blenders.
Re-refined oils are a key lever for reducing the carbon footprint of lubricants, aligning with global sustainability goals.
—
Anuj Kumar, Industry Expert at Kline + Company
Used Oil
Generation
Used Oil
Regeneration
(On-site + Off-site)
Used Oil Burned
at Source, or
Unaccounted for
Used Oil
Collection
Used Oil
Aggregation
Used Oil
“Refined” to
Heavy
Distillates
RFO + Used
Oil Burned
Used Oil
Refined to
Base Oils
Refined
Distillates
Cracked or
Burned
Base Oil
Blending +
Packaging
Lubricants
Marketing +
Distribution
Why Re-refining?
With companies increasingly adding sustainability or net zero goals to their strategy, used oil re-refining aligns with these goals by diminishing or removing their reliance on mineral oil. State-of-the-art technology in this field has advanced significantly, enabling the production of basestocks whose quality is comparable to, and occasionally surpasses, that of virgin basestocks.
Challenges in Re-refining
Despite the potential of used oil re-refining, the industry confronts a multitude of challenges, which include inadequate used oil collection infrastructure, primitive used oil storage and segregation practices impacting quality, and lack of governmental and regulatory support.
Re-refining Products
Global Used Oils and Re-Refined Lubricants
As the focus increases on sustainability, this report provides a comprehensive analysis of key trends, developments, changes, challenges, and business opportunities.
Advisory services
To support our clients in overcoming distinct business challenges, Kline provides strategic advisory services spanning the entire industry value chain.
Whether focusing on growth opportunities, identifying suitable partners, conducting due diligence, formulating marketing strategies, enhancing operational efficiency, or performing economic analysis, we leverage our extensive knowledge base to deliver premier strategic advisory services.
With a seasoned team of consultants and industry specialists boasting over 150 years of collective experience, Kline’s comprehensive and tailored services ensure clients are well-equipped to navigate the complexities of the market.
Due Diligence:
We conduct thorough assessments to evaluate potential investments, partnerships, or acquisitions, providing comprehensive market analyses, regulatory assessments, and competitor insights.
Market Potential + Scanning
Our continuous monitoring of global and regional markets helps identify emerging trends and new opportunities, keeping you informed about the latest developments.
Product Slate Design
We assist in designing product offerings that maximize commercial viability while aligning with sustainability goals.
Demand
Forecasting
Using advanced modelling techniques, we accurately forecast future demand to optimize production and investment strategies.
Partner
Identification
We help identify and assess potential partners that align with your strategic goals.
Our Expertise
At Kline + Company, we assist businesses in navigating and capitalizing on the challenges presented by this dynamic market. Our team of experts offers comprehensive market studies and strategic advisory programs, providing actionable insights that enable our clients to make well-informed decisions.
Under sponsorship of the Used Oil Refining Coalition, Kline provided substantial support for the U.S. Department of Energy’s study “Used Oil Management and Beneficial Reuse Options to Address Section 1: Energy Savings from Lubricating Oil Public Law 115-345”, published in December 2020
Assisted the California Energy Commission with studies which were used in preparation of its bellwether LCA study, entitled “Life Cycle Assessment of Used Oil Management in California -- Pursuant to Senate Bill 546 (Lowenthal) (DRRR-2013-1465)”, published in 2014
Worked closely with the European used oil industry association GEIR (Groupement Européen de l’Industrie de la Regénération), through collaboration to develop a statistical database on used oil generation, collection, cross-border flows, and uses across the EU
