Asia Pacific Base Oil Market Trends

Statistics for the 2023 & 2024 Asia Pacific Base Oil market trends, created by Mordor Intelligence™ Industry Reports. Asia Pacific Base Oil trend report includes a market forecast to 2029 and historical overview. Get a sample of this industry trends analysis as a free report PDF download.

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Team License

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Corporate License

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Market Trends of Asia Pacific Base Oil Industry

Engine Oils to Dominate the Market

  • Engine oils are crucial in the smooth running of engines, reducing fuel emissions and improving engine performance.
  • The engine oil segment dominates the demand for base oil due to the growing demand for engine oil from industries such as automotive, power, heavy equipment, metalworking, and chemicals.
  • In automotive, engine oil is the most common form of lubricating oil used for better lubrication, cleaner engines, effective cooling, and protection against corrosion.
  • For vehicle owners, engine oils help reduce costly repairs. It provides a longer engine lifespan and supports smooth functioning, decreasing fuel consumption and CO2 emissions.
  • According to the Society of Indian Automobile Manufacturers (SIAM), in the financial year 2023, the total production volume of vehicles in India was around 25.93 million units, which was an increase of 12.54% from the previous year.
  • In 2022, according to METI (Japan) and JAMA, approximately 6.57 million passenger cars were produced in Japan.
  • Further, according to the Korea Automobile Manufacturers Association (KAMA), the local brand Kia Motors, followed by Hyundai Motor Company, was the leading car manufacturer in South Korea in 2022. Vehicles manufactured by Kia Motors accounted for 39.4% of automobile sales in South Korea in the same year.
  • The growing number of automobiles is increasing the demand for lubricants, such as engine oil. Various companies are expanding their production capacity to meet the growing demand.
  • For instance, in 2023, Exxon Mobil Corporation announced to invest INR 9 billion (USD 109.51 million) to build a lubricants production plant in Maharashtra, India.
  • Additionally, in 2022, Chevron strengthened its position as a leading supplier of premium base oils to customers globally with the acquisition of Nestle Corporation's NEXBASE brand. This enhanced the strong position of the company in the Asia-Pacific region.
  • Therefore, all such above-mentioned factors are likely to increase the demand for base oil in Asia-Pacific over the forecasted period.
Asia Pacific Base Oil Market: Vehicle Production, Volume in Million Units, India, 2018-2022

China to Dominate the Regional Market

  • In Asia-Pacific, China dominates the demand for base oil on the back of increasing demand for lubricants due to rising automotive production and increasing maintenance requirements from the industrial sector and for on-road vehicles.
  • In China, demand for base oils has improved significantly, with downstream lubricant oil producers making purchases as demand from end-user industries has improved from the previous year.
  • China continues to be the world’s largest vehicle market in terms of both annual sales and manufacturing output, wherein domestic production is expected to reach 35 million vehicles by 2025.
  • According to the Organisation Internationale des Constructeurs d'Automobiles (OICA), the total vehicle production accounted for 27 million units in 2022, registering an increase of 3.4% compared to 26 million units produced in 2021.
  • According to the China Association of Automobile Manufacturers (CAAM), the total production of passenger cars and commercial vehicles in 2022 reached 2.38 million and 318 thousand units, respectively.
  • Additionally, infrastructure projects have also boosted lubricant demand in China, giving rise to the demand for base oil.
  • China has accelerated infrastructure investment in the first quarter of 2023 to propel economic growth, launching more than 10,000 projects throughout the country.
  • The demand for power generation from the wind power sector has increased rapidly in China, which demands the installation of wind turbines. As a result, the wind power sector opens up numerous opportunities for gear oil which aids in improving the reliability and performance of machine parts and protection against mechanical wear and reduce corrosion.
  • According to the Global Wind Energy Council (GWEC), China accounted for approximately 47% of the world's newly installed onshore wind power capacity in 2022.
  • In 2023, China completed the installation of the world’s largest wind farm, which could power 13 million homes. The CNY 6 billion (USD 885 million) project is sited Southeast of the Liuao Peninsula in China’s Fujian Province.
  • Therefore, the factors mentioned above contribute to the increasing demand for base oils in China during the forecast period.
Asia Pacific Base Oil Market: Automotive Production, in Million Units, China, 2018-2022

Asia-Pacific Base Oil Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)