The global offshore lubricants market is characterized by high degree of competition by integrated MNCs. The top four companies in the industry accounted for 45% of the market in 2014. These four companies are ExxonMobil Corp., Royal Dutch Shell, Chevron, and Castrol. Competition is intensifying on account of the presence of major oil and gas companies across the value chain. Key players are participating in expansion strategies to maintain their position in the market, states a new report by Transparency Market Research (TMR). A case in point would be Total S.A. This company in February 2014, announced expansion of its operations in the Mediterranean region. Similarly, ExxonMobil has planned the development of a new unit in Singapore with a production capacity of 62,000 barrels per day.
According to the report by TMR, the global offshore lubricants market is expected to reach US$183.5 mn by the end of 2020. By end use, offshore rigs accounted for a significant share in the past, but in the years to come, FPSO is projected to exhibit a faster growth in the overall market. On the basis of application, engine oil was leading in the market. Engine oil segment is driven by the growing maritime traffic and high requirement for offshore vessels. However, the grease segment is anticipated to expand at faster pace in the coming years on account of the increasing consumption by oil and gas equipment and offshore machinery. By geography, the Rest of the World held the top position in the past with West Africa and Brazil contributing the most to the market on account of the increasing investments in large scale projects so as to develop offshore reserves in these areas.
Large-scale Undertakings for Development of Deepwater and Ultra Deepwater Oil and Gas Wells Driving Market
Offshore lubricants are highly in demand as they ensure that machines are working or functioning properly. Offshore lubricants help in the reduction of wear and tear as well as friction in the functional components of machines, and thus their demand is increasing. Moreover, lubricants have several beneficial characteristics such as thermal stability, high viscosity index, resistance to corrosion and oxidation, and low freezing point. All these factors are boosting the growth of the offshore lubricants market.
The growing investments in offshore oil and gas explorations and shale gas explorations are one of the primary reasons behind the high demand for offshore lubricants. In addition to this, governments have undertaken large-scale projects for the development of ultra deepwater and deepwater oil and gas wells, which is expected to create several growth opportunities for players in the offshore lubricants market.
Environmental Concerns Regarding Unregulated Disposal of Offshore Lubricants to Pose a Challenge
Some of the factors challenging the growth of the offshore lubricants market include, environmental concerns regarding the use of some lubricants. Stringent environmental regulations regarding the unregulated disposal of offshore lubricants as it can threaten the aquatic life. In addition to this, the volatility in the pricing of petrochemicals will also restrict the growth of this market. On the other hand, this is expected to lead to an emergence of a new trend in the industry- bio-based marine lubricants. Players in the market are striving to develop bio-based marine lubricants so as to remain in the competition.
This review is based on Transparency Market Research’s report, titled “Offshore Lubricants Market (End User - Offshore Rigs, FPSO; Application – Engine Oil, Hydraulic Oil, Grease Oil, Grease) - Global Industry Analysis, Size, Share, Growth, Trends, and Forecast 2014 - 2020.”
The global offshore lubricants market is segmented as follows:
Offshore Lubricants Market: End User Segment Analysis
- Offshore rigs
Offshore Lubricants Market: Application Segment Analysis
- Engine oil
- Hydraulic oil
- Gear oil
- Others (turbine oil, compressor oil, circulating oil, etc.)
Offshore Lubricants Market: Regional Analysis
- North America
- Middle East
- Asia Pacific
- RoW (Rest of the World)
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