JobbersWorld

June 13, 2024

JobbersWorld is a Petroleum Trends International, Inc. (PTI) Publication

Featured Articles

A Look Back at 2022 and Ahead to 2023

January 5, 2023

On e for the Record Books

April 5, 2022

Fast Facts - The Lubricants Business 2021

January 14, 2022

Chevron’s VARTECH

November 11, 2021

Is the Buy-Back Business Model Broken?

June 20, 2021

Supply is King at this Moment in Time

June 10, 2021

Staying Connected

March 1, 2021

Where’s My Stuff?

March 11, 2020

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In the News and on the Wire

ENEOS and Mighty Auto Parts Announce Distribution Partnership

ENEOS USA Inc and Georgia-based Mighty Auto Parts, announce a new distribution partnership across the United States and in Ontario, Canada. Mighty will stock the ENEOS 0W-8 Motor Oil, ENEOS Import DPS Fluid, and ENEOS ECO CVT Fluid.

Mighty supports a nationwide network of franchises and company operations located in 44 states serving more than 15,000 automotive service facilities. Headquartered just outside of Atlanta, Georgia, Mighty also partners with more than 25,000 repair facilities – from independents to large multi-bay specialty shops and tire centers– in their specialty wholesale distribution operation. High-quality OEM parts and personalized local service make Mighty a dependable partner to the thousands of owners, corporations and professional automotive repair shops across the United States.

“We are thrilled to partner with Mighty Auto Parts to bring our premium motor oil and transmission fluids to even more customers across North America,” said Katsuhiro “Kaz” Nakazato, President & CEO at ENEOS USA Inc. “Their reputation for excellent service and commitment to quality products aligns perfectly with our own core values.” More>>

2024 Mighty National Sales Meeting & Supplier Trade Show in Scottsdale, AZ - 6/13/2024

Matrix Advises Land O’Sun Management on its Sale to Anabi/Rebel

Matrix Capital Markets Group, Inc., a leading, independent investment bank, has advised Land O’Sun Management Corporation d/b/a Fast Track on the sale of its petroleum marketing, convenience retail and quick-service restaurant businesses to Anabi Real Estate Development, LLC and its affiliates d/b/a Anabi/Rebel. Headquartered in Gainesville, Florida, Fast Track is a leading petroleum marketing, convenience retail and QSR company, operating 17 convenience stores, 10 co-located QSRs, and two stand-alone QSRs in Northern Florida. More>>

Cerilon GTL North Dakota Moves into FEED, The Final Stage Before FID

Cerilon announced today that it has successfully completed FrontEnd-Loading (FEL 2) for its gas-to-liquids (GTL) facility in North Dakota and is moving into Front-End Engineering Design (FEED), the last stage before the company makes a Final Investment Decision (FID) for its foundational GTL project.

Cerilon is developing an innovative GTL facility that will transform natural gas into unique, high performance synthetic products. These products include industry-leading Group III+ base oils, ultra-low sulfur diesel and naphtha. The company has established global partnerships to deliver this foundational GTL facility, which will be followed by replicated GTL facilities. More>>

In Last Week's Issue of JobbersWorld

Energy Information Agency Data - Signs of Hope or more of the Same?

In recently release (5/31/2024) data from the Energy Information Administration (EIA), U.S. Product Supplied of Lubricants showed an uptick in March 2024. Product supplied reportedly reached 2,353 thousand barrels in March, up from 2,133 barrel in February 2024. Although this can be taken as a positive sign of a recovery, the volume of lubricant products supplied has been very volatile since the start of the pandemic. And according to many marketers JobbersWorld speaks with, the volatility has been palpable and cause for concern and caution moving forward. In the worlds of several marketers... just when it looks like a recovery is in the making, demand changes direction.

One trend seen from the EIA, however, is the downward movement in demand seen since the start of the pandemic, as shown in the chart below.

While the EIA data on lubricants supplied methodology may not be the same others use to estimate lubricant consumption, it is directionally consistent with Petroleum Trends Internationals estimates.

According to the EIA, the U.S. Product Supplied of Lubricants "approximately represents consumption of petroleum products because it measures the disappearance of these products from primary sources, i.e., refineries, natural gas processing plants, blending plants, pipelines, and bulk terminals. In general, product supplied of each product in any given period is computed as follows: field production, plus transfers to crude oil supply, plus biofuels plant net production, plus refinery and blender net production, plus imports, plus net receipts, plus adjustments, minus stock change, minus refinery and blender net inputs, minus exports."

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Challenging Time to Push Through Lubricant Price Increases

The dynamics of the finished lubricant price increases seen so far in 2024 are uncharacteristic of what we have seen in the past. Historically, when a few blenders announce prices increases, many others do the same within a roughly 30-day window separating the first to move from the last. This is not surprising considering that increases in the cost of base oil, additives, packaging and other inputs affect most blenders at roughly the same time.

There were 17 lubricant price increases from 2019 to 2023. With few exceptions, each of the increases followed closely on the heels of increases in the cost of base oil and/or additives. Based on the relationship of the frequency and magnitude of base oil and finished lubricant price increases, price movements indicate that cost increases are most often passed on. Similar pricing dynamics are seen in JobbersWorld’s data going back over nearly the last two decades. But while this too should come as no surprise, what we are now seeing is different.

With some of the leading base oil suppliers already into a second round of base oil increases in 2024, finished lubricant suppliers have been slow to respond.

Among the majors, ExxonMobil announced an increase of up to 15%, effective May 22, 2024, and base oil price movements reportedly triggered formulaic/indexed price increases on certain lubricants sourced from Shell. While several of the larger independent blenders also announced increases, there have been fewer than historically seen following base oil increases.

Blenders and marketers attribute the sluggish price movements to lackluster lubricant demand and the increased intensity of competition that comes with it. While it varies by distributor and market segments, sales volumes are reportedly down by 2 to 3% since the start of the year. So, although base oil and additive prices have moved up in 2024, pushing through finished lubricant price increases at this time has been particularly challenging for blenders and distributors.

GOT NEWS?

Do you have lubricant or fuel related news (acquisitions, new products, locations, hires, promotions, events, and others) that you would like to share with JobbersWorld? If so, please send to news@jobbersworld.com