The UK lubricant market size is 4493.3 Mn in 2027 with growth, share, players, trends, segmentation, outlook, challenges, opportunities, and future forecast.
Market Overview
UK Lubricants Market Overview
The UK Lubricants Market reached USD 2749.7 Mn in 2022 and is projected to grow to USD 2957.5 Mn by 2027, reflecting a CAGR of 1.5% during the forecast period 2022–2027. The market’s expansion is primarily driven by a rising focus on sustainability, an increasing inclination toward synthetic lubricants, and growing construction activity across the region. Within the market, automotive lubricants hold a dominant position, accounting for 51.5% of the total market share in 2022.
UK Lubricants Market Definition
Definition of UK Lubricants Market: The revenue for automotive & industrial lubricants market in UK have been computed by the summation of revenues generated through domestic sales of lubricants (Synthetic, Semi-Synthetic and Mineral). The sales have been recorded at retailer price. Lubricants typically contains 90% base oils (petroleum-mineral oils) and less than 10% additives. The market is segmented by type of lubricants (automotive lubricants and industrial lubricants), by grade (mineral, synthetic, semi-synthetic). The report encompasses of all the major players such as BP Plc Castrol, ExxonMobil, Total Energies, Chevron Texaco, and Shell. Additionally, the report will analyze market future projections, industry analysis, and key factors influencing UK Lubricants Market.
Taxonomy
UK Lubricants Market Ecosystem
UK Lubricants Market Size by Value (in USD Mn), 2017-2022
In 2022, the UK lubricants market reached USD 2749.7 million. However, the market experienced a significant challenge in 2020 due to the COVID-19 pandemic, which led to a sharp decline in lubricant prices as the annual growth rate dropped to -25.3%. This decline was primarily driven by two factors: first, the reduction in demand for lubricants as economic activities slowed down during lockdowns and restrictions, impacting key industries such as automotive and manufacturing; and second, a decrease in the prices of base oils, a key component used in lubricant production, which further contributed to the overall price decline. Over the historic period, the Compound Annual Growth Rate (CAGR) stood at -2.7%, indicating a gradual reduction in market value. Additionally, the retail price index for oil consumption in the UK increased by 30% in 2022 compared to 2021. Since oils are the primary raw material used in the manufacturing of lubricants, this surge led to an increase in lubricant prices.
UK Lubricants Market Industry Analysis
Strength
Australia has a robust agricultural sector that produces a diverse range of perishable goods, including fruits, vegetables, dairy products, and meat. This provides a solid foundation for the cold chain industry as it requires temperature-controlled handling and distribution.
Weakness
Dispersed population presents logistical challenges in managing an extensive cold chain network. Remote and regional areas have limited access to cold storage facilities and face higher transportation costs.
Opportunity
The adoption of advanced technologies such as IoT sensors, real-time monitoring systems, and data analytics presents opportunities to improve efficiency, reduce waste, and enhance supply chain visibility.
Threat
The industry is subject to stringent regulations. Failure to comply with these regulations can result in penalties, damage to reputation, and legal consequences.
Rising Construction Activities Benefitting UK Lubricants Market
The construction industry in the UK experienced an increase of 5.6% in 2022 when compared to 2021. The increase was due to a rise in new work, which grew by 3.8%, and repair and maintenance, which increased by 8.5%. Demand for construction equipment is driven by rising building activities in the UK region. The number of new construction projects initiated annually rose by 7% in 2022 and an additional 6% in 2023. Residential construction activities saw a significant surge, with new home constructions increasing by 10% each year. Commercial projects also experienced growth, with a 6% increase annually. Infrastructure development received substantial investments, leading to a 9% increase in infrastructure construction activities in 2022. Repair and maintenance activities in the UK construction sector also witnessed growth, with expenditures increasing by 8.5% in 2022 compared to 2021. This rise in repair and maintenance spending reflects ongoing efforts to improve the condition and longevity of existing infrastructure and buildings. The 2023 UK National Infrastructure and Construction Pipeline comprises 660 projects, programs, and other investments across a wider range of infrastructure types than ever. Over the next two years to 2025, the total value of planned public and private investment is £164 billion, an average of £82 billion per annum. This growth in the construction sector directly translates into increased demand for lubricants. The demand for construction equipment and machinery, requiring efficient lubrication, saw a corresponding rise, driving sales volumes in the lubricants market.
Synthetic Lubricants a Game Changer in UK Lubricants Market
The market for synthetic oils is expected to grow with a CAGR of 2.8% from 2022 to 2027, in contrast to mineral oil, which is projected to experience a negative CAGR of -3.6% during the same period. The reason for this trend is that synthetic oils are purer, offer better flow characteristics, and are longer-lasting. In the marine sector, synthetic lubricants accounted for 50% of total lubricant sales in 2021, compared to 35% in 2019. Similarly, in the aviation industry, synthetic lubricants saw a 15% increase in adoption from 2019 to 2023. Synthetic lubricants are estimated to reduce carbon emissions by up to 25% compared to conventional mineral-based lubricants. This environmental benefit has led to increased adoption, with 80% of businesses prioritizing sustainability when selecting lubricants. Synthetic lubricants have steadily gained market share from conventional mineral-based lubricants over the past five years. In 2019, synthetic lubricants held a market share of 35%, which increased to 50% by 2023. Surveys indicate that 70% of consumers now prefer synthetic lubricants for their vehicles, citing improved engine performance and longevity as the primary reasons for their preference. This impact of synthetic lubricants on the UK lubricants market underscores their increasing adoption across various industries and their environmental and performance benefits.
Increased Focus on Sustainability Driving Growth of UK Lubricants Market
Several key players in the UK lubricants market have implemented specific measures to reduce their environmental impact. BP Castrol introduced its "NEXCEL" system, a closed-loop oil change system that reduces waste by up to 50%. This innovation, implemented in 2021, has not only helped reduce the environmental footprint of oil changes but has also resulted in significant cost savings for customers. Shell has also made strides in sustainability by launching its "Shell Eco-Marathon" program, aimed at promoting energy efficiency and innovation in transportation. As part of this initiative, Shell introduced its "Shell Helix Ultra with PurePlus Technology" lubricant in 2022, which is made from natural gas and offers improved fuel economy by up to 3%. Similarly, ExxonMobil has focused on reducing emissions by introducing its "Mobil SHC" range of synthetic lubricants, which are formulated to offer extended drain intervals, resulting in reduced waste oil generation. This initiative, implemented in 2023, has led to a 20% reduction in carbon emissions associated with lubricant changes. These sustainability measures have not only contributed to the environmental goals of these companies but have also resonated with consumers and businesses seeking greener alternatives. As a result, these initiatives have played a significant role in driving the growth of sustainable lubricants in the UK market, with sales volumes of environmentally friendly lubricants witnessing a steady increase year on year.
Shortage of Base Oil a Major Challenge for UK Lubricants Market
The UK lubricants market faces a pressing challenge with a shortage of base oils, exacerbated by fluctuating demand dynamics due to the COVID-19 pandemic. Following the pandemic, demand for vehicle fuel and aviation paraffin significantly decreased, with aviation paraffin witnessing an extraordinary 80.0% decline post-COVID. This demand shift, alongside shortages in other refinery products essential for base oil production, has strained the supply chain, impacting lubricant manufacturing. Recent years have seen stark numerical trends illustrating the severity of this challenge. In 2021, base oil shortages resulted in a 15% reduction in lubricant production capacity. The situation deteriorated in 2022, with base oil availability plummeting by 25% compared to pre-pandemic levels. By 2023, the shortage persisted, leading to a substantial 30% decline in base oil supply for lubricant manufacturing. These numerical insights underscore the urgent need for the UK lubricants market to address base oil shortages promptly to ensure a steady supply and meet the diverse lubrication needs of various industries.
Ban on Russian Oil Imports, Challenge to the UK Lubricants Market
The UK lubricants market faces a formidable challenge following the imposition of a ban on the import of crude oil from Russia in 2022, prompted by the Russia-Ukraine war. This ban has reverberated across the UK and other Western economies, triggering a ripple effect manifested in the form of rising crude oil prices. The ban's impact on the UK lubricants market is significant, with several numerical trends highlighting its severity. In 2021, before the ban, the UK sourced approximately 10% of its crude oil imports from Russia, amounting to around 100 million barrels per year. However, with the imposition of the ban in 2022, this crucial source of crude oil supply abruptly ceased, leading to disruptions in the lubricants market. By 2022, the ban had already begun to exert its influence, resulting in a 15% increase in crude oil prices compared to the previous year. This upward trend continued into 2023, with crude oil prices soaring by an additional 20% as the bank's long-term effects set in. Consequently, the UK lubricants market grapples with heightened production costs and supply chain disruptions, as the increased crude oil prices trickle down to higher manufacturing expenses.
In September 2022, Castrol and Renault announced the extension of their lubricants aftermarket supply partnership until 2027. In 2023, a new Master Lubricants Agreement (MLA) enabled the extension of the 2020 Testing Oil Partnership, with Shell becoming Wärtsilä’s designated strategic partner for stationary engine oils. In 2022, wholly owned subsidiaries of Shell plc in Switzerland, the UK, the US, and Sweden—Shell (Switzerland) AG, Shell U.K. Limited, Pennzoil-Quaker State Company, and Shell Aviation Sweden AB—completed the acquisition of the Environmentally Considerate Lubricants (ECLs) business of the PANOLIN Group. In 2023, TotalEnergies Lubricants launched a new campaign featuring RobotQuartz, a mascot designed to represent the engine and demonstrate the effects of Quartz lubricants on all types of engines. Also in 2022, two additional service stations transitioned to the Texaco brand after previously operating under the Shell brand. Johnsons Retail’s Pentwyn Service Station in Cardiff and Central Convenience Stores’ Verwood Motors in Dorset both switched to Texaco branding in recent months.
UK Lubricants Market Segmentation
UK Lubricants Market Segmentation by Type of Lubricants (Sales Volume in %), 2022
The UK lubricants market is segmented into two main categories: automotive and industrial lubricants, with automotive lubricants holding a market share of 51.5% and industrial lubricants accounting for 48.5%. This distribution reflects the dominant usage of lubricants in the automotive sector, driven by the extensive use of vehicles across the country. The automotive industry encompasses a wide range of vehicles, including cars, trucks, and motorcycles, all of which require regular lubrication for optimal performance and longevity. On the other hand, the industrial sector also relies heavily on lubricants for machinery and equipment maintenance, albeit to a slightly lesser extent compared to the automotive sector. Factors such as stringent vehicle maintenance requirements, increased vehicle ownership, and ongoing technological advancements in automotive lubricants contribute to the higher market share of automotive lubricants. Nonetheless, industrial lubricants remain crucial for various industries such as manufacturing, construction, and energy, ensuring smooth operations and equipment longevity.
UK Lubricants Market Segmentation by Grade (Sales Volume in %), 2022
The UK lubricants market is segmented by grade, with synthetic lubricants holding the largest share at 42%. This dominance can be attributed to several factors, including the superior performance and durability of synthetic lubricants compared to their mineral and semi-synthetic counterparts. Synthetic lubricants offer better viscosity stability, enhanced resistance to oxidation and thermal breakdown, and improved lubrication properties across a wide range of temperatures. As a result, they are often preferred for use in high-performance engines and machinery, contributing to their higher market share. Meanwhile, semi-synthetic lubricants hold a 32% market share, offering a balance between performance and cost-effectiveness. They combine synthetic and mineral oil components to provide improved lubrication properties compared to mineral oils alone, making them suitable for a variety of applications. Mineral-grade lubricants, with a 27% market share, are valued for their affordability and widespread availability. While they may not offer the same level of performance as synthetic or semi-synthetic lubricants, they remain popular choices for many everyday applications where cost is a primary consideration.
UK Lubricants Future Market Size
The UK lubricants market, valued at USD 2749.7 million in 2022, is projected to grow to USD 2957.5 million by 2027, representing a compound annual growth rate (CAGR) of 1.5%. Increasing industrialization and automotive production drive the demand for lubricants in various sectors. Additionally, technological advancements in lubricant formulations enhance efficiency and performance, further stimulating market growth. Growing awareness of environmental sustainability encourages the adoption of eco-friendly lubricants, fostering market expansion. Furthermore, the shift towards synthetic and bio-based lubricants, coupled with stringent regulations promoting their use, propels market demand. As the UK economy continues to recover and industries rebound post-pandemic, coupled with ongoing technological innovations and sustainability initiatives, the lubricants market is poised for steady growth in the forecast period.
UK Lubricants Market Major Players Company Profile
Company Name
Establishment year
Description
Castrol India Ltd
1889
Castrol India Ltd, a public limited entity with BP holding nearly 51% equity, is among India’s largest lubricant manufacturers and marketers. The company operates three major manufacturing units in Silvassa, Patalganga and Paharpur. Its extensive distribution footprint includes over 105,000 retail outlets supported by nearly 420 distributors across the country. Castrol markets its automotive lubricants under two well-known brands—Castrol and BP—and maintains strong leadership across several product categories such as passenger car engine oils, 4-stroke motorcycle engine oils and multi-grade diesel engine oils.
ExxonMobil Corporation
1882
ExxonMobil, often referred to simply as Exxon, is a major American multinational oil and gas company and the largest successor to John D. Rockefeller’s Standard Oil. Formed in 1999 through the merger of Exxon and Mobil, the company is vertically integrated across the global oil and gas value chain. Its portfolio spans exploration, production, refining, chemicals and petroleum product marketing. It is also a major producer of plastics, synthetic rubber and chemical products. ExxonMobil is the largest oil and gas producer in the United States and one of the world’s biggest corporations, ranking eighth globally by revenue and third in the U.S.
Shell plc
1907
Shell plc is a leading British multinational oil and gas company headquartered in London. As a public limited company, it is primarily listed on the London Stock Exchange, with additional listings on Euronext Amsterdam and the New York Stock Exchange. A major part of the “Big Oil” group, Shell is the second-largest investor-owned oil and gas company worldwide after ExxonMobil. It is also one of the largest corporations globally. Historical environmental studies indicate that Shell was the ninth-largest corporate greenhouse gas emitter between 1988 and 2015.
TotalEnergies SE
1924
TotalEnergies SE is a French multinational integrated energy and petroleum company established in 1924 and ranked among the world’s seven supermajor oil companies. Its operations span the entire energy value chain—including crude oil and natural gas exploration, production, power generation, refining, marketing and international oil trading. The company is also a major player in the global chemicals sector. TotalEnergies is part of the Euro Stoxx 50 stock index, and in the Forbes Global 2000 list for 2023, it was ranked as the 21st largest public company globally.
Chevron Corporation
1879
Chevron Corporation is a prominent American multinational energy company primarily engaged in the oil and gas sector. The company is vertically integrated across exploration, production, refining, transportation, chemicals manufacturing and power generation. Chevron is one of the world’s biggest oil companies and the second-largest in the United States by revenue, following ExxonMobil. In the Fortune 500 list for 2023, Chevron secured the 10th position, highlighting its scale and financial strength.
UK Lubricants Market Macroeconomic Indicators
The Population of United Kingdom was 65.11 Mn in 2015, and it increased at a constant rate in coming years too. The population was recorded 65.65 Mn in 2016 and in 2023 the population was 68.27 Mn.
The GDP of UK was USD 2870.9 Bn in 2017 and it reached USD 3259.8 in 2022. The inflation rate was seen at 2.3% in 2017 and 2.5% in 2021.
The GDP per capita in United Kingdom was recorded at USD 46,374 in 2017 and the GDP per capita reached USD 47,923 in 2022.
Frequently Asked Questions
Find quick answers to common questions about the UK’s evolving lubricants market
The UK Lubricants Market reached USD 2749.7 Mn in 2022.
BP Plc Castrol, ExxonMobil, TotalEnergies, Chevron Texaco, and Shell are some of the major players in UK Lubricants Market.
Rising focus on sustainability, inclination towards synthetic lubricants and rising construction activity in the region are some of the major drivers of UK Lubricants Market.
UK Lubricants Market is expected to reach USD 2957.5 Mn by 2027 with a CAGR of 1.5% during the forecast period 2022-2027.
