Lubricants Market Morning Report 20260512

Global Market Brief (Formal English Version for Petrochemical Official Website)

I. Global Market Trends

International crude tops $100/bbl; Brent hits 2026 yearly high

Driven by heightened geopolitical tensions in the Middle East, Brent crude broke the $100 per barrel threshold to mark its highest level of 2026. Analysts warn prices could surge further to the $105–110 range if conflicts persist. Global lubricant base oil prices rose in tandem, squeezing profit margins for refineries.

Global base oil supply tightens; Group II base oil prices climb

Constrained by refinery maintenance cycles and geopolitical risks, global Group II base oil supply has tightened, with prices up 8–12% month-on-month. Operating rates of Asia-Pacific refineries dropped to 75%, and supply shortages are unlikely to ease before June. Lubricant manufacturers face mounting cost pressure, with several brands rolling out price hikes.

Shell announces strategic overhaul of global lubricant division

Shell revealed a strategic shift for its worldwide lubricant business, prioritizing high-performance synthetic oils and EV-specific fluids. The firm plans to invest USD 500 million over three years to upgrade production lines across the Asia-Pacific, focusing on China, India and Southeast Asia, while gradually phasing down capacity for conventional mineral oils.

ExxonMobil launches new generation low-viscosity fuel-saving engine oils

ExxonMobil rolled out 0W-16 and 0W-20 low-viscosity fuel-efficient engine oils built on cutting-edge additive technology, delivering a 3–5% improvement in fuel economy. Complying with API SP and ILSAC GF-6B specifications, the products target new vehicles from Japanese, Korean, European and American automakers.

China’s lubricant exports rise 15% YoY; Southeast Asia becomes core market

China’s lubricant export volume grew 15% year-on-year from January to April 2026, with Southeast Asia accounting for 35% of total shipments. Robust demand from Indonesia, Vietnam and Thailand centers on industrial lubricants and marine oils. Domestic refineries are accelerating overseas expansion by establishing distribution hubs across Southeast Asia.

II. Lubricant Industry News

Global lubricant market to reach USD 178 billion in 2026

The latest report from Grand View Research forecasts the global lubricant market will hit USD 178 billion in 2026 at a compound annual growth rate (CAGR) of 3.2%. Synthetic lubricants will capture an expanding share, projected to account for 42% of total market volume in 2026. EV-exclusive fluids represent the fastest-growing product segment.

Bio-based lubricant market expands rapidly with 8.5% CAGR

Toughened environmental regulations fuel rapid growth in bio-based lubricants, with an expected CAGR of 8.5% for 2026–2030. Europe and North America remain major consumption regions, while the Asia-Pacific registers the fastest growth. Vegetable oil-based hydraulic oils and chain oils have achieved full commercialization.

III. South American Market

Brazil’s lubricant market grows 4.2% in Q1 on strong industrial demand

Data from Brazil’s petroleum association shows domestic lubricant consumption rose 4.2% year-on-year in Q1 2026, with industrial lubricant demand jumping 6.8% amid manufacturing recovery. Shell, ExxonMobil and local brand BR Lubrificantes hold dominant market shares.

Argentina lifts lubricant import quota restrictions

The Argentine government abolished import quotas for lubricants to stabilize domestic prices, expected to ease supply shortages caused by prior foreign exchange controls. International players including Shell and Chevron plan to ramp up local investment.

IV. African Market

Full launch of Dangote Refinery boosts self-sufficiency in lubricant base oil

Nigeria’s Dangote Refinery entered full operation with a daily capacity of 650,000 barrels, sufficient to meet regional demand for lubricant base oil across West Africa. The facility will reduce West Africa’s reliance on imported base oils and cut regional lubricant prices by an estimated 10–15%.

TotalEnergies expands capacity amid South Africa’s lubricant market restructuring

TotalEnergies announced a EUR 200 million expansion of its lubricant blending plant in Durban, lifting production capacity by 40%. The expanded facility caters to the Southern African Development Community (SADC), specializing in lubricants for mining and power generation.

V. Russian Market

Russia shifts lubricant exports to Asia; China takes 45% share

Persistent Western sanctions have driven Russia to redirect all lubricant exports toward Asia. Shipments to China surged 28% year-on-year Jan–Apr 2026, making up 45% of Russia’s total lubricant exports. Core export products include industrial gear oils and hydraulic oils, priced 15–20% lower than international branded alternatives.

Russian refineries ramp up Group II base oil exports to China

Rosneft, Russia’s national oil company, plans to boost Group II base oil shipments to China, targeting an annual export volume of 500,000 metric tons in 2026. The feedstock mainly supplies domestic private lubricant manufacturers, priced 8–10% cheaper than Middle Eastern base oils, albeit with inconsistent quality stability.

VI. South Asian Market

India mandates BS-VI Phase 2 emission standards, accelerating lubricant upgrades

India will enforce BS-VI Phase 2 emission standards starting July 2026, forcing a full upgrade of automotive lubricants to API SP / ACEA C series grades. Roughly 30% of low-end lubricant production capacity faces elimination, while synthetic oils are set to capture 25% market share.

Pakistan’s lubricant market rebounds; motorcycle oil demand surges

After two consecutive years of decline, Pakistan’s lubricant market rebounded 7.3% year-on-year in Q1 2026. Rapid growth in motorcycle ownership fueled a sharp rise in demand for two-stroke engine oils, sparking fierce competition between Japanese and local domestic brands.

VII. Malaysian Market (Marine Lubricants Focus)

Port Klang marine lubricant sales up 12% YoY in Q1

Port Klang Authority statistics show marine lubricant sales climbed 12% year-on-year in Q1 2026, driven by a higher volume of transit vessels. Shell, BP and Chevron maintain leading market positions, while biodegradable marine lubricants are undergoing small-scale trial applications.

Singapore-Malaysia marine fuel price gap widens to $25/MT

Stricter environmental regulations from Singapore’s Maritime Port Authority lifted local bunker fuel prices, expanding the price spread between Singapore and Malaysia to USD 25 per metric ton. A growing number of shipowners refuel in Malaysian ports; bunkering volumes at Johor’s Tanjung Perang Port rose 18% year-on-year.

VIII. Lubricant Basic Knowledge

What is the Viscosity Index, and why does it matter for buyers?

The Viscosity Index (VI) quantifies how much a lubricant’s viscosity changes with temperature. A higher VI indicates stable viscosity across temperature fluctuations. For end users, high-VI oils avoid excessive thickening in cold weather and thinning under high heat, delivering superior equipment protection. Multi-grade oils with VI above 140 (e.g. 5W-40) are recommended for purchase.

[Customer-Friendly Popular Science]

API SP vs SN Plus: Core Performance Upgrades

Key improvements of API SP over SN Plus:

1. Enhanced wear protection for timing chains

2. Stronger resistance to Low-Speed Pre-Ignition (LSPI)

3. Improved control over turbocharger deposit formation

Launched in May 2020, API SP is designed for China National VI and Euro VI vehicles. Confirm vehicle API requirements with customers during sales.

[Sales Training Technical Guide]

IX. Technical Highlights (Additive Technology)

Research Progress of Molybdenum-Based Additives in Fuel-Efficient Lubricants

Technical Key Points:

1. Friction reduction mechanism of molybdenum disulfide (MoS₂)

2. Anti-wear synergistic effect of organic molybdenum compounds (MoDTC)

3. Interaction between molybdenum additives and ZDDP

4. Fuel efficiency improvement range (1.5–3%) enabled by molybdenum additives

5. Application limitations: degradation risks under high-phosphorus environments

Application Scenarios: Fuel-saving engine oils, gear oils

Core Conclusion: Molybdenum additives are core technology for boosting fuel economy, yet formulation compatibility must be prioritized.

R&D Progress of Novel Ashless Anti-Wear Additives

Technical Key Points:

1. Shortcomings of traditional phosphorus- and sulfur-containing ZDDP for exhaust aftertreatment systems

2. Working mechanisms of ashless anti-wear additives (organic boron, organic nitrogen compounds)

3. Anti-wear performance comparison via Four-Ball Test & Pin-on-Disc Test

4. Synergistic/antagonistic effects with metallic detergents

5. High-temperature stability evaluation

Application Scenarios: Engine oils compliant with China National VI and Euro VI emission standards

Core Conclusion: Ashless anti-wear additives represent the mainstream future direction, though current costs remain high and anti-wear service life lags behind ZDDP.