Lubricants Market Expected to Reach $168.2 Billion by 2031—Allied Market Research

According to a new report published by Allied Market Research, titled, “Lubricants Market," The lubricants market was valued at $123.8 billion in 2021, and is estimated to reach $168.2 billion by 2031, growing at a CAGR of 3.2% from 2022 to 2031.

A lubricant refers to any substance that is physically integrated for the purpose of reducing friction between two or more moving surfaces. Lubricants help prevent material degradation, erosion, corrosion and rust formation on metallic surfaces. The lubricant used can be a fluid, solid, or plastic substance.

Increasing demand for vehicles and their spare parts is anticipated to fuel the demand for automotive oils and greases during the forecast period. The major economic recovery in North America and Europe is expected to boost the consumer vehicles segment, which, in turn, is a boon for the market. Typical lubricants manufacturers use crude oil, tight oil, and other additives to formulate all types of lubricants. Furthermore, lubricants are majorly used as diesel engine oils, gearbox & transmissions in passenger cars, commercial vehicles, and motorcycle segments of the automotive sector. Over the projection period, rising auto sales are anticipated to boost global industry growth. Countries such as India, China, the U.S., and Brazil are principally responsible for the increase in global vehicle sales.

The global Lubricants market is segmented on the basis of product type, base oil, end-use industry and region.

On the basis of product type, the engine oil segment dominated the global lubricant market in terms of revenue, in 2021, and is expected to maintain its dominance during the forecast period. This is attributed to the fact that the engine oil lubricates the engine parts for its efficient movement, thereby reducing the extent of metal contact, friction, and heat generation within the engine. In addition, cleaning & cooling the engine parts, sealing the gaps, and rust prevention are the other functions carried out by the engine oil.

On the basis of base oil, the mineral segment dominated the global lubricant market in terms of revenue in 2021, owing to the fact that mineral is used in a variety of industries, including automotive, textile, construction, industrial, medical, pharmaceutical, electronics, and consumer goods, as a result of which demand is constantly increasing.

On the basis of end-use industry, the automotive and other transportation segment dominated the global lubricant market in terms of revenue, in 2021. The passenger cars offer maximum market potential in the automotive lubricant market, owing to increase in demand for these cars and general utility vehicles globally, with rise in public transportation expenditure. For instance, according to the Association des Constructeurs Européens d'Automobiles (ACEA) in 2021, 79.1 million motor vehicles were produced around the world, an increase of 1.3% compared to 2020.

On the basis of region, Asia-Pacific dominated the global lubricant market in terms of revenue, in 2021, owing to increase in urbanization in emerging countries.

The major players operating in the industry include British Petroleum, Chevron Corp, ExxonMobil Corp, Marathon Petroleum Corporation, Neste OYJ, Philips 66 Company, Saudi Aramco, Shell Co, Sinopec Corp, and S-Oil Corporation. These players have adopted product launch, acquisition, and business expansion as their key strategies to increase their market shares.

KEY FINDINGS OF THE STUDY

• On the basis of base oil, the mineral segment emerged as the global leader by acquiring more than 64.2% of the market share in 2021, while synthetic segment is anticipated to continue this trend during the forecast period.
• On the basis of product type, the engine oil segment accounted for 27.9% of the global market share in FY2021.
• On the basis of end-use industry, the automotive and other transportation segment accounted for 59.0% of the global market share in FY2021.
• On the basis of region, Asia-Pacific is the major consumer of lubricants among other regions. It accounted for around 39.7 % of the global market share in 2021.

IMPACT OF COVID-19 ON THE GLOBAL LUBRICANTS MARKET

• The outbreak of the COVID-19 pandemic has had an adverse impact on the global economy as governments globally were forced to implement lockdowns to prevent the spread of the virus. As a result, the activities in the lubricants market were hampered.
• COVID-19 has spread to almost 213 countries around the globe, with the World Health Organization declaring it a public health emergency on March 11, 2020.
• Some of the major economies suffered from the COVID-19 crisis include, Germany, France, Italy, Spain, the UK, and Norway.
• The COVID-19 pandemic impacted negatively on the manufacturing and industrial industries due to scarcity of resources in various parts of the globe. The industry's top players are concerned about the market's prospects and are rethinking their strategies to meet the challenge.
• Transport limitations were implemented, resulting in reduced industrial production and disrupted supply chains, which affected global economic growth by a substantial proportion, severely impacting market growth due to COVID-19 pandemic.
• During the COVID-19 pandemic, extensive lockdown in crucial manufacturing sectors such as metalworking, fabrication, oil & gas, chemicals, and consumer goods caused a temporary production halt in all regions. As a result, the industrial sector witnessed a drop in demand for lubricating oils. However, the industrial sector was able to partially resume operations as the lockdown was gradually lifted.
• The COVID-19 outbreak had a rapid and devastating impact on the global automotive sector. Chinese parts shipments were disrupted, large-scale manufacturing disruptions occurred across Europe, and assembly plants in the U.S. collapsed. This has put a lot of pressure on the automotive sector that is already dealing with a downturn in global demand, and it will certainly lead to more merger and acquisition.
• Furthermore, due to social distancing norms during COVID-19, the manufacturing companies worked with limited workforce, thus negatively impacting the production of lubricants.