Asia Pacific Base Oil Market Size, Share & Industry Analysis, By Type (Group I, Group II, Group III, Group IV and Others), By Application (Engine Oils, Gear Oils, Metalworking Fluids, General Industrial Oils and Greases, Process Oils and Others), Country Forecast, 2026-2034

The Asia Pacific Base Oil Market size was valued at USD 21.87 billion in 2025. The market is projected to grow from USD 23.33 billion in 2026 to USD 38.60 billion by 2034, at a CAGR of 6.5% during the forecast period. China accounted for the largest market share owing to the huge demand from the Automotive industry.

Base oil is the primary component of finished lubricants, derived from refining crude oil or chemical synthesis, providing lubrication, heat dissipation and protection against wear, with demand driven by industrialization, automotive growth and rising needs for high-performance, eco-friendly lubricants, especially in the Asia Pacific region. Rising machinery use in developing economies (China and India) fuels demand for industrial lubricants. Growth in vehicle count and stricter emission norms drive demand for base oil, such as high-quality base oil, Group II/III oils for engine and transmission fluids.

• For instance, in 2025, India's Group II base oil imports in October stayed high at over 120,000 tonnes, second-highest in 17 months, with heavy grades hitting a 4-year peak despite a light-grade drop. Firm demand favors Group II over Group I due to availability and price.

Sinopec is a dominant force and a player in the Asia Pacific Base Oil Market, leveraging its massive refining infrastructure and strong position in the Asia Pacific region. Other players, such as PetroChina and Saudi player Aramco, alongside global leaders with strong Asian presence such as Chevron and ExxonMobil, all command huge volumes and market influence, with Aramco and Chinese firms often leading on a large scale.

ASIA PACIFIC BASE OIL MARKET TRENDS

Shift Toward Higher-Quality Base Oils is Key Market Trend

The market is undergoing a notable shift toward higher-quality formulations, driven by escalating demand for superior engine performance and longevity in automotive and industrial applications. Refiners and producers increasingly prioritize Group II and Group III base oils, which deliver enhanced viscosity stability, oxidation resistance, and energy efficiency compared to conventional options. This evolution aligns with stricter environmental regulations and the rise of advanced lubricants tailored for the production and sales of vehicles, heavy machinery and high-performance engines.

Downstream sectors, including power generation and manufacturing, embrace these premium stocks to minimize wear, extend service intervals and support sustainability goals. As supply chains adapt, collaborations between petrochemical giants and technology innovators accelerate the transition, positioning the region as a hub for next-generation lubrication solutions.

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MARKET DYNAMICS

MARKET DRIVERS

Growing Demand for Automotive and Industrial Lubricants is Driving the Market Growth

Rising demand for automotive and industrial lubricants propels the Asia Pacific base oil market growth. This is also fueled by rapid vehicle production, urbanization and expanding manufacturing sectors. Automakers seek high-performance formulations to enhance engine efficiency and durability in diverse climates. At the same time, industries such as steel, chemicals and power generation require robust oils for heavy machinery and precision equipment.

• In December 2025, BYD partnered with Mobil to launch the world's first PHEV-specific engine oil series for its DM-i hybrid system, tackling frequent starts/stops, low-temperature moisture and high-load demands. The flagship 0W-20 oil exceeds wear standards by 50% and boosts emulsification stability 2.5 times. This supports BYD's 4.182 million China sales.

This surge underscores the need for versatile, high-quality base stocks that support longer equipment life, reduced downtime and compliance with evolving emission standards across the region.

MARKET RESTRAINTS

Dependence on Raw Materials Restraints the Market Growth

The market faces significant restraint from heavy dependence on imported raw materials, exposing producers to volatile global crude oil prices and supply disruptions. Regional refineries rely extensively on foreign feedstocks, making them vulnerable to geopolitical tensions, trade barriers and fluctuating exchange rates that inflate production costs. This reliance hampers pricing stability and long-term planning, while efforts to diversify sources or boost domestic refining capacity lag behind surging demand. Consequently, manufacturers grapple with margins squeezed by unpredictable input expenses, underscoring the urgency for strategic self-sufficiency initiatives.

MARKET OPPORTUNITIES

Increasing Use of Base Oil in the Healthcare Sector is Driving Market Growth Opportunities

The expansion of re-refined base oils presents a compelling opportunity for the market, harnessing recycled used oils to create sustainable, high-performance alternatives. This approach reduces reliance on virgin crude, cuts environmental impact through lower carbon emissions, and meets rising demand for eco-friendly lubricants in automotive and industrial sectors.

Producers gain cost advantages via circular supply chains, while supportive regulations and consumer preferences for green products accelerate adoption, strategic investments in advanced re-refining technologies position regional players to capture premium market share and drive long-term profitability.

MARKET CHALLENGES

Raw Material Price Volatility & Supply Chain Disruption Present Significant Challenge for Market Growth

Raw material supply and pricing pose persistent challenges for the market, as producers navigate erratic global crude oil availability and sharp price swings. Dependence on imported feedstocks exposes the region to supply chain bottlenecks from geopolitical unrest, shipping delays and refining outages elsewhere. Volatile pricing disrupts cost forecasting, squeezes refining margins and forces frequent adjustments in lubricant manufacturers' production techniques. While local production ramps up slowly, these pressures heighten operational risks, compelling firms to hedge aggressively and pursue alternative sourcing strategies amid intensifying regional demand.

Segmentation Analysis

By Type

Group I Segment is Dominant as it is Majorly Used Across Automotive and Industrial sectors

Based on the segmentation of Type, the market is classified into Group I, Group II, Group III, Group IV, and Others.

Group I segment dominated the market with a market share of 50.09% in 2025 for its cost-effectiveness and widespread use in conventional lubricants across automotive and industrial applications.

Meanwhile, Group IV base oils have emerged as a fastest-growing segment, driven by demand for superior thermal stability, low volatility, and high-performance formulations in advanced engines and synthetic blends.

By Application

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Engine Oils Are Dominant Due to their Prominence in Automotive Industry

Based on the segmentation of application, the market is classified into Engine Oils, Gear Oils, Metalworking Fluids, General Industrial Oils, Greases, Process Oils and Others.

In 2025, the Engine Oils segment dominated the market with a share of 54.75% powering a vast fleet of vehicles and machinery with reliable lubrication under diverse operating conditions.

• For instance, in July 2025, Castrol launched the new MHP lubricant range (MHP 1-30 & 1-40) on July 16, 2025, for four-stroke medium-speed engines on distillate fuels, LNG, and biofuels. Featuring a lower base number, superior detergents, oxidation resistance and cleanliness.

Meanwhile, process oils are the fastest-growing segment, propelled by expanding applications in rubber, textiles, and chemicals manufacturing, where their specialized properties enhance production efficiency and product quality.

Asia Pacific Base Oil Market Country Outlook

By geography, the market is categorized into China, India, Japan, South Korea and the Rest of the Asia Pacific.

China

China held the dominant Asia Pacific base oil market share in 2025, valued at USD 11.01 billion, and also expected to take leading share in 2026 with USD 11.74 billion, fueled by its expansive manufacturing base, booming automotive sector, and massive industrial demand. Robust refining infrastructure and strategic investments in high-quality base oil production ensure a steady supply to meet needs in engine oils, greases and specialty lubricants. Government policies promoting energy efficiency and emission controls further solidify its leadership position amid rapid urbanization and infrastructure growth.

India

India is projected to record a growth rate of 8.02% in the coming years, which is the third highest among all countries, and reached a valuation of USD 3.27 billion in 2025 driven by surging vehicle production, expanding industrial activities and rising lubricant consumption across automotive and manufacturing sectors. Aggressive capacity expansions by domestic refiners, coupled with increasing adoption of premium synthetic blends, propelled this momentum. Supportive economic reforms and infrastructure investments position India to challenge established players in the coming years.

• For instance, in August 2025, TotalEnergies Marketing India launched new Quartz engine oils, meeting API SQ and ILSAC GF-7 standards. The range—Quartz 9000 Xtra Future XT 0W-16, Quartz 9000 Future GF-7 0W-20, and Quartz 7000 Future GF-7 5W-30—offers 40% better LSPI protection, 20% improved chain wear resistance, 7% enhanced piston cleanliness, and up to 16% fuel efficiency gains for modern turbo/GDI engines. Blended locally, these support emissions reduction and longevity.

COMPETITIVE LANDSCAPE

Key Industry Players

Companies are Actively Expanding Their Market Share Via Partnerships, Business Expansion, And Technological Advancements

The Asia Pacific Base Oil Market holds a moderately fragmented market structure, constituting prominent players such as GS Caltex Corporation, Petroliam Nasional Berhad (Petronas), China Petroleum & Chemical Corporation (Sinopec), China National Petroleum Corporation (PetroChina), and others. Companies operating in the Base Oil industry are adopting targeted growth strategies focused on strengthening technical capability, expanding manufacturing presence, and improving access to high-demand sectors.

LIST OF KEY ASIA PACIFIC BASE OIL COMPANIES PROFILED:

• Exxon Mobil Corporation (U.S.)
• Chevron Corporation (U.S.)
• GS Caltex Corporation (South Korea)
• Petroliam Nasional Berhad (Petronas) (Malaysia)
• China Petroleum & Chemical Corporation (Sinopec) (China)
• China National Petroleum Corporation (PetroChina) (China)
• S-Oil Corporation (South Korea)
• Indian Oil Corporation Ltd. (India)
• Neste Corporation (Finland)
• HP Lubricants (India)
• Royal Dutch Shell plc (Netherlands/UK)
• SK Lubricants (South Korea)
• Phillips 66 Company (U.S.)
• CNOOC Limited (China)
• Ergon, Inc. (U.S.)

KEY INDUSTRY DEVELOPMENTS

• In September 2025, Sinopec is expanding its synthetic base oil portfolio with a new mPAO (metallocene polyalphaolefin) project at its Maoming Petrochemical facility in China. The plant, China's first large-scale mPAO production site, will break ground by end-2025, enhancing high-performance lubricant capabilities for automotive and industrial applications.
• In September 2025, ExxonMobil launched a pioneering technology at its Singapore refinery on Jurong Island, converting low-value fuel oil into higher-value Group II base stocks and fuels. The facility boosts production by 20,000 barrels per day, including 6,000 bpd of innovative EHC 340 MAX for engine, gear, marine oils and greases in commercial and industrial uses.
• In February 2025, Chevron Lummus Global (CLG) commissioned the world's largest white oil hydroprocessing unit at Hongrun Petrochemical in Weifang, China. Using ISODEWAXING and ISOFINISHING technologies, the facility produces 500,000 MTPA of industrial-grade and 200,000 MTPA of food-grade white oil for pharmaceuticals, cosmetics and lubricants.
• In December 2025, Shaoguan City, China, exported its first batch of camellia skincare base oil to the EU from Ruyuan Yao Autonomous County. A local firm became the sole Chinese supplier to a French luxury brand, elevating camellia oil from a kitchen staple to a high-end cosmetics ingredient. The city aims to build it into a pillar industry.
• In October 2023, Gulf Oil Lubricants India partnered with South Korea's S-Oil to produce, distribute, and promote KIA service-fill lubricants at franchisee workshops. The deal launches S-Oil Seven's fully synthetic and Group II base oil lubricants in India for the first time outside Korea, targeting passenger cars, motorcycles and diesel engines.

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