Global Synthetic Lubricants Market Grows Steadily at a CAGR of 3.28%

Introduction

Synthetic lubricants are chemical compounds that reduce or control friction between industrial surfaces. It is manufactured from synthetic base oils and chemically modified substances, such as esters, polyalthaolefin (PAO), and polyethylene glycols (PAGs), and has properties comparable to petroleum-based products. Engine, hydraulic, metalworking, compressor, gear, refrigeration, turbine, and transmission oils are common synthetic lubricants.

The lubricant dissipates the heat emitted by the mechanical components and lowers the moving parts' temperature, extending the equipment's overall service life. The advantages of synthetic lubricants include low energy consumption, volatility, high thermal and oxidative stability, and high flash points. As a result, they have diverse applications in the construction, mining, food processing, oil and gas, textile, pharmaceutical, and automotive industries.

Market Dynamics

Growing Use in the Automotive Sector Drives the Global Market

The COVID-19 epidemic caused a decline in supply and demand in the worldwide automotive sector. Automotive industry disruptions have directly impacted the production and consumption of lubricants in the automotive and transportation industries. The automotive industry will significantly drive the demand for synthetic lubricants. As global automobile production returns to pre-pandemic levels, synthetic lubricant demand will inevitably increase.

As automobiles become lighter and more potent, optimal engine performance requires high-performance lubricants. Synthetic lubricants facilitate fuel's rapid and efficient passage through the engine, enhancing fuel economy. High-mileage engines necessitate synthetic lubricants of a higher price and durability. The market expansion will be aided by increased profit margins for manufacturers of high-quality synthetic lubricants.

Demand for Higher Fuel Economy Vehicles Creates Tremendous Opportunities

Fuel efficiency is a key consideration for both automotive manufacturers and consumers. Manufacturers are endeavoring to produce more fuel-efficient vehicles, and consumers demand them. As the price of petroleum and diesel increases, the demand for fuel-efficient vehicles will rise significantly. Numerous methods exist to improve fuel economy and choose the proper synthetic lubricants.

Synthetic lubricants reduce engine wear, offer superior cold-weather protection, and extend oil change intervals. Unlike conventional lubricants, synthetic lubricants do not harden at negative or very low temperatures since they do not include waxes. Moreover, no additional effort is required to circulate engine and gear lubricant during engine startup. Thus, the demand for vehicles with greater fuel economy is anticipated to generate enormous opportunities for market expansion.

Regional Analysis

Asia-Pacific is the most significant global synthetic lubricants market shareholder and is estimated to grow at a CAGR of 3.66% over the forecast period. Asia-Pacific is an emerging market because Asian cities are home to nearly half of the world's urban population and account for two-thirds of the world's urban population growth. China is the largest consumer of synthetic lubricants in the Asia-Pacific region, followed by Japan, India, South Korea, and Indonesia. The demand from new infrastructure projects is expected to increase China's lubricant consumption by approximately 3 percent to 8.2 million tons by 2021, according to the Chinese research firm Oilchem. According to the China Association of Automobile Manufacturers, China sold 2 million passenger cars in January, a 26.8 percent increase from January 2020, when the pandemic hit the country's automobile industry.

North America is anticipated to exhibit a CAGR of 3.15% over the forecast period. The region's demand for synthetic lubricants is driven by the enormous scale of the end-user industries, such as automotive, chemical manufacturing, and rising industrial output. The region is also at the forefront of manufacturing innovations, bolstered by comprehensive product development emphasizing energy efficiency, weight reduction, reduced lifecycle costs, and sustainability. In addition, innovative and eco-friendly synthetic lubricants will experience significant growth during the forecast period. Although EV sales in the United States have fluctuated over the past five years, over 310,000 electric vehicles were sold in 2021, and the upward trend is anticipated to continue due to enhancements by Tesla and Toyota. The growth of the synthetic lubricants market can be ascribed to the rising popularity of electric cars (EVs), which drives up demand for the synthetic lubricants used in EV parts.

Key Highlights

• The global synthetic lubricants market is estimated to grow at a CAGR of 3.28% during the forecast period (2023–2031).
• Based on application, the global synthetic lubricants market is segmented into engine oil, transmission fluids and hydraulic fluids, metalworking fluids, greases, and others. The engine oil segment is the largest contributor to the market and is projected to exhibit a CAGR of 3.54% over the forecast period.
• Based on end-users, the global synthetic lubricants market is bifurcated into power generation, automotive and transportation, heavy equipment, food and beverage, and others. The automotive and transportation segment dominates the global market and is estimated to exhibit a CAGR of 3.56% during the forecast period.
• Based on type, the global synthetic lubricants market is segmented into polyalphaolefin, esters, and polyethylene glycol. The polyalphaolefin segment owns the highest market share and is projected to grow at a CAGR of 3.58% over the forecast period.
• Asia-Pacific is the most significant global synthetic lubricants market shareholder and is estimated to grow at a CAGR of 3.66% over the forecast period.

Competitive Players

Competitive Players

The key players in the global synthetic lubricants market are Royal Dutch Shell, ExxonMobil, Sasol, Valvoline, British Petroleum, Chevron, Morris Lubricants, Dow, Indian Oil, Petronas, Lukoil, Idemitsu Kosan, Fuchs, Total Energies, Sinopec, and others.

Recent Developments

Market News

• In June 2023, Shell, the global leader in refined lubricants, introduced Shell Helix HX6 5W-30 and Shell Helix SUV 5W-30, a new line of BS-VI-compliant synthetic engine oils, in India.
• In March 2023, Uno Minda, a leading provider of automotive solutions, announced the launch of its new BS6 Phase-compliant engine lubricants for small- to medium-sized motorcycles. High-viscosity mineral, semi-synthetic, and wholly synthetic grades of BS6-compliant engine oils have been introduced.

Segmentation

Global Synthetic Lubricants Market: Segmentation

By Applications

• Engine Oil
• Transmission Fluids and Hydraulic Fluids
• Metalworking Fluids
• Greases
• Others

By End-User

• Power Generation
• Automotive and Transportation
• Heavy Equipment
• Food and Beverage
• Others

By Type

• Polyalphaolefin
• Esters
• Polyalkylene Glycol

By Regions

• North America
• Europe
• Asia-Pacific
• Latin America
• The Middle East and Africa