HollyFrontier to Acquire Red Giant Oil

IN THE NEWS AND ON THE WIRE

HollyFrontier to Acquire Red Giant Oil

HollyFrontier today announced that it has entered into a definitive agreement to acquire Red Giant Oil Company (“Red Giant Oil”). Red Giant Oil, a private family-owned lubricants company founded in 1903, is one of the largest suppliers of locomotive engine oil in North America.

Headquartered in Council Bluffs, Iowa, Red Giant Oil has storage facilities in Idaho, Utah and Wyoming, along with a blending and packaging facility in Texas. Following the acquisition, Red Giant Oil is expected to generate approximately $7.5 million in annual forecasted EBITDA for HollyFrontier.

George Damiris, President and CEO of HollyFrontier, commented, “We are pleased to announce the acquisition of Red Giant Oil, with its outstanding history and brand in the railroad lubricant industry. This transaction demonstrates the continued growth of our lubricant business and brings outstanding value to HollyFrontier.”

This transaction is subject to customary closing conditions and is expected to close in the third quarter of 2018. HollyFrontier was represented by Morgan Lewis & Bockius LLP on this transaction.

About HollyFrontier Corporation:
HollyFrontier Corporation, headquartered in Dallas, Texas, is an independent petroleum refiner and marketer that produces high value light products such as gasoline, diesel fuel, jet fuel and other specialty products. HollyFrontier operates through its subsidiaries a 135,000 barrels per stream day (“bpsd”) refinery located in El Dorado, Kansas, a 125,000 bpsd refinery in Tulsa, Oklahoma, a 100,000 bpsd refinery located in Artesia, New Mexico, a 52,000 bpsd refinery located in Cheyenne, Wyoming and a 45,000 bpsd refinery in Woods Cross, Utah. HollyFrontier markets its refined products principally in the Southwest U.S., the Rocky Mountains extending into the Pacific Northwest and in other neighboring Plains states. In addition, HollyFrontier, through its subsidiary, owns Petro-Canada Lubricants Inc., whose Mississauga, Ontario facility produces 15,600 barrels per day of base oils and other specialized lubricant products, and owns a 57% interest and a non-economic general partner interest in Holly Energy Partners, L.P.audience.

 

Safety-Kleen Announces Increase

As previously reported in JobbersWorld, Safety-Kleen (Kleen Performance Products) began contacted its U.S. customers on June 15th to announce a price increase on all blended lubricants and grease products of up to 9%. The increase is effective July 16.

In addition to its U.S. price increase, Safety-Kleen began contacting its Canadian customers last week about a similar price increase on all blended lubricants and grease products in Canada, effective August 6.

Price Increase Roundup

Independent lubricant manufacturers are the first and the fastest to move on price in the latest round of increases.

Independent lubricant manufacturers kicked off the most recent round of lubricant price increases with Sinclair’s announcement on May 8th of a 10 to 12% adjustment effective July 1, 2018. By the end of May most independents followed with announced increases. ExxonMobil was the first major to move with an announcement coming on June 1. TOTAL followed on June 8th and a within 26 days all other majors announced price increases. Most of these increases came in the first two weeks of June. A timeline of the recent round of prices increases is shown below.

IncreaseTimeline6262018R3

In all cases, when reasons are given for the price increase, the drivers are said to be increases in the cost of base oils, additives, packaging, and transportation.

In addition to being the first to move, independent lubricant manufacturers also moved more quickly than the majors in this round of price increases. As shown below, whereas there is an average of 16 days from the time independents announced an increase to its effective date, the average distance for the majors is 34 days.

Average price increase (announced) 7.3%
Average time from announcement to effective date 22 days
Independents: Average time from announcement to effective date 16 days
Majors: Average time from announcement to effective date 34 days

 

According to some of the independent lubricant manufacturers JobbersWorld has spoken with, independent lubricant manufacturers are often the first to move and have less lead time then the majors due to their tighter margins. In addition, whereas majors generally purchase base oil under contract, some independents source from the spot market. Consequently, they have to respond relatively fast to maintain margins when base oil prices increase, as seen over the past few months shown below.

CrudePic6262018

In addition to the base oil price increases already seen in 2018, there has been an increase in the price of lubricant additives. The first was announced on May 18th by Afton when it advised its customers that effective June 18, 2018, it will increase prices on all performance additive products from all source points. The price adjustment is said to be in response to higher raw material and transportation costs.

Lubrizol followed on May 29 when it announced a price increase that varied across product areas and specific product families effective July 1, 2018. Lubrizol attributes the increase to the higher cost of raw materials resulting from robust demand and continuing consolidation and closure of capacity. In addition, the price adjustments are said to be necessary due to significant increases in transportation costs.

It should be noted that the higher than typical number of lubricant price increases we have seen so far in 2018 are reflected in the comparatively steep ramp up shown below in the Producer Price Index (PPI) for Petroleum Lubricating Oils and Grease Manufacturing (NAICS 324191). The PPI is an index published by the Bureau of Labor Statistics that measures the average change in the selling prices received by domestic producers for their output over time.

ProducerPriceIndexChart

Recently Announced Lubricant Price Increases

Company Announced Date Effective Date Increase
Sinclair Lubricants 5/8/2018 7/1/2018 10 to 12%
Sunoco 5/16/2018 6/16/2018 4 to 6%
Advanced Lubrication Specialties 5/16/2018 6/16/2018 4 to 6%
CAM2 5/18/2018 6/16/2018 4 to 9%
Smitty’s Supply 5/18/2018 6/16/2018 4 to 9%
U.S. Lubricants, Commerce, CA 5/18/2018 6/17/2018 $0.40/gal lubricants
$0.05/lb greases
Axel Royal 5/21/2018 6/24/2018 5%
Chemlube 5/22/2018 6/11/2018 5 to 9%
Maverick Performance Products 5/22/2018 6/18/2018 4 to 8%
Allegheny Petroleum Products 5/23/2018 6/18/2018 6 to 8% on bulk, additional 2% on drums and totes
Warren Distribution 5/23/2018 6/25/2018 4 to 8%
PennStar 5/23/2018 6/15/2018 6 to 10%
Martin Lubricants 5/23/2018 6/22/2018 5 to 9%
Old World Industries 5/24/2018 6/30/2018 4 to 9%
ExxonMobil 6/1/2018 7/1/2018 up to 9%
TOTAL Specialties USA 6/8/2018 7/1/2018 4 to 6%
Nu-Tier Brands/Gulf/ECOSE 6/11/2018 7/13/2018 6 to 8%
Shell 6/13/2018 7/16/2018 up to 10%
Reliance Fluid Technologies 6/13/2018 7/16/2018 4 to 8%
Lubriplate 6/13/2018 8/13/2018 Mineral oil-based Lubricants by 7%, Synthetic/Long-life lubricants by 4%
Chevron 6/14/2018 8/1/2018 up to 9%
Safety-Kleen 6/15/2018 7/16/2018 up to 9%
Valvoline 6/19/2018 8/1/2018 up to 9%
Phillips 66 6/22/2018 7/23/2018 up to 9%
Calumet Branded Products 6/25/2018 7/25/2018 up to 10%
Castrol North America 6/26/2018 8/6/2018 up to 9%

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 1

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 2

Click on the Timeline Below to See All Effective Increase Dates in 2018

TimelineLong6262018

Calumet Announces Increase, Valvoline Introduces new HDEO

Calumet Announces Price Increase

Calumet Branded Products announced today that effective July 25th, 2018, Calumet Branded Products will implement a price increase of up to 10% on finished lubricants. Calumet attributes the adjustments to increasing costs of raw materials used in the production and delivery of its products.

Scroll to bottom of page for complete list of recent price increases reported by JobbersWorld.

Valvoline Unveils its Premium Blue One Solution™

One Solution has become the first engine oil approved to meet Cummins Engine Spec (CES 20092) that allows for extended drains in natural gas engines.

As previously communicated in Valvoline’s April 2018 Product Information Bulletin, a new mobile natural gas engine oil performance specification has been introduced for stoichiometric combustion Cummins Westport mid-range and heavy-duty engines. The new specification-Cummins Engineering Standard (CES) 20092-provides significantly improved oxidation and thermal stability compared to previous natural gas oils.

ValvolinePremiumBlue9200With today’s announcement, Valvoline says its new “Premium Blue One Solution™” has become the first engine oil approved to meet Cummins Engine Spec (CES 20092) that allows for extended drains in natural gas engines.

According to Valvoline, with the use of CES 20092 compliant oils, such as Valvoline™ Premium Blue One Solution™, Cummins Westport has recommended increasing oil drain intervals for some engines and applications. Applicable engines are the Cummins Westport ISX12 G, ISX12N, ISL G, and L9N natural gas engines.

  • ISX12 G / ISX12N: The recommended interval is 40,000 mi (64,000 km) for vehicles with average road speeds greater than 25 mph (40 kph).

Operators of vehicles with average road speeds less than 25 mph (40 kph), should consult the appropriate Operation and Maintenance manual for recommended oil drain intervals.

  • ISL G / L9N: The recommended interval is 1,000 hrs.

All Cummins Westport natural gas engines using stoichiometric combustion are compatible with CES 20092 oils. These platforms will benefit from a transition to CES 20092 oils, which require a more modern oil additive system than previously used for CES 20074 or CES 20085 oils. The new specification requires a much stronger antioxidant combination to provide protection at the high temperatures experienced in modern natural gas engines. The range of allowable ash levels for CES 20092 oils (0.7-0.9%) is similar to the CES 20085 specification. Lean burn legacy engines should continue to use CES 20074 oils until further notice.

Click for more


Recently Announced Lubricant Price Increases

Company Announced Date Effective Date Increase
Sinclair Lubricants 5/8/2018 7/1/2018 10 to 12%
Sunoco 5/16/2018 6/16/2018 4 to 6%
Advanced Lubrication Specialties 5/16/2018 6/16/2018 4 to 6%
CAM2 5/18/2018 6/16/2018 4 to 9%
Smitty’s Supply 5/18/2018 6/16/2018 4 to 9%
U.S. Lubricants, Commerce, CA 5/18/2018 6/17/2018 $0.40/gal lubricants
$0.05/lb greases
Axel Royal 5/21/2018 6/24/2018 5%
Chemlube 5/22/2018 6/11/2018 5 to 9%
Maverick Performance Products 5/22/2018 6/18/2018 4 to 8%
Allegheny Petroleum Products 5/23/2018 6/18/2018 6 to 8% on bulk, additional 2% on drums and totes
Warren Distribution 5/23/2018 6/25/2018 4 to 8%
PennStar 5/23/2018 6/15/2018 6 to 10%
Martin Lubricants 5/23/2018 6/22/2018 5 to 9%
Old World Industries 5/24/2018 6/30/2018 4 to 9%
ExxonMobil 6/1/2018 7/1/2018 up to 9%
TOTAL Specialties USA 6/8/2018 7/1/2018 4 to 6%
Nu-Tier Brands/Gulf/ECOSE 6/11/2018 7/13/2018 6 to 8%
Shell 6/13/2018 7/16/2018 up to 10%
Reliance Fluid Technologies 6/13/2018 7/16/2018 4 to 8%
Lubriplate 6/13/2018 8/13/2018 Mineral oil-based Lubricants by 7%, Synthetic/Long-life lubricants by 4%
Chevron 6/14/2018 8/1/2018 up to 9%
Safety-Kleen 6/15/2018 7/16/2018 up to 9%
Valvoline 6/19/2018 8/1/2018 up to 9%
Calumet Branded Products 6/25/2018 7/25/2018 up to 10%

IncreaseTimeline6212018R3

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 1

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 2

Click on the Timeline Below to See All Effective Increase Dates in 2018

IncreaseLong6212018

 

Chevron Announces Price Increase for Lubes and Greases

 

Chevron is the Third Major to Announce a Price Increase in Round Three for 2018, and add Reliance Fluid Technologies to the List of Independent Blenders Announcing a Price Adjustment

Chevron announced a general price increase of all lubricating oils and greases up to 9%. The price movement is effective August 1, 2018. Chevron attributes the increase to the higher cost of raw materials impacting the manufacturing of its products.


Reliance Fluid Technologies (RFT) announced it will implement a price increase of 4 to 8% a gallon on its bulk and packaged lubricants. The increase is effective July 16, 2018. RFT says the increase is due to the rising costs of base oil, additives and freight.


BREAKING NEWS – Shell Claims Shell Rotella Meets The Standards While A Leading Diesel Engine Oil Does Not

Shell announced a bold and what you can be sure will be a contentious finding. According to Shell, a sample of Mobil Delvac 1300 Super 15W-40 it examined does not meet API CK-4 performance standards or the more stringent OEM standards claimed for the product.

Shell says, ” When you buy a Shell Rotella® heavy duty engine oil, you rely on our brand to deliver on our promise of protection for your vehicle. That promise is demonstrated by the approvals and specifications that are printed on the label of each Shell Rotella® product.

Shell spends countless hours of work, not only in the laboratory, but also in the real world, to make sure that trust is deserved. Shell also routinely collects and tests competitor oils (competitor benchmarking) to compare our product’s performance against the competition. Recently, Shell ran the industry standard Volvo T-13 test at an independent testing facility using Mobil Delvac 1300 Super 15W-40. The sample was sent blind to eliminate bias.

The Volvo T-13 is a grueling 360-hour, severe high temperature oil oxidation test. The test pushes oil marketers to develop engine oils that are resilient in challenging operating environments of newer, more fuel-efficient engines. The Volvo T-13 is a key barrier against engine oils with inadequate oxidation protection.

The test limits for the Volvo T-13 focus on two standard measurements: Kinematic Viscosity at 40oC (KV 40) in the last 60 hours of the test (ASTM D445) and oxidation by infra-red spectroscopy. These limits are important as they represent the baseline for API CK-4 limits and the more stringent OEM limits. This new test was devised to set the bar for the API CK-4 category of engine oil, designed to include advanced oxidation stability and shear stability.

Oxidation stability of an engine oil refers to its capability to resist thermal and chemical breakdown during engine operation. It is a key indicator of an engine oil’s ability to protect the engine itself and engine hardware.

Using an engine oil that lacks oxidation stability can lead to several engine maintenance and performance issues, such as:

  • Deposit build up on engine parts that can lead to reduced oil drain intervals and shorter engine life
  • More corrosion of engine parts that can lead to greater wear and potentially damage your engine, which could lead to shorter engine life
  • Higher viscosity of oil that can lead to reduced engine efficiency and fuel economy
    End Quote

Shell provided its distributors with the results of the Volvo T-13 tests in support of its claim and according to that data, the sample of Mobil Delvac 1300 15W-40 CK-4 Shell examined “does not meet the minimum API CK-4 requirements or the Volvo/Mack or Cummins OEM requirements.”

CLICK TO SEE DATA

Round 3 Lubricant Price Increase Summary

Company Announced Date Effective Date Increase
Sinclair Lubricants 5/8/2018 7/1/2018 10 to 12%
Sunoco 5/16/2018 6/16/2018 4 to 6%
Advanced Lubrication Specialties 5/16/2018 6/16/2018 4 to 6%
CAM2 5/18/2018 6/16/2018 4 to 9%
Smitty’s Supply 5/18/2018 6/16/2018 4 to 9%
U.S. Lubricants, Commerce, CA 5/18/2018 6/17/2018 $0.40/gal lubricants
$0.05/lb greases
Axel Royal 5/21/2018 6/24/2018 5%
Chemlube 5/22/2018 6/11/2018 5 to 9%
Maverick Performance Products 5/22/2018 6/18/2018 4 to 8%
Allegheny Petroleum Products 5/23/2018 6/18/2018 6 to 8% on bulk, additional 2% on drums and totes
Warren Distribution 5/23/2018 6/25/2018 4 to 8%
PennStar 5/23/2018 6/15/2018 6 to 10%
Old World Industries 5/24/2018 6/30/2018 4 to 9%
ExxonMobil 6/1/2018 7/1/2018 up to 9%
TOTAL Specialties USA 6/8/2018 7/1/2018 4 to 6%
Nu-Tier Brands/Gulf/ECOSE 6/11/2018 7/13/2018 6 to 8%
Shell 6/13/2018 7/16/2018 up to 10%
Reliance Fluid Technologies 6/13/2018 7/16/2018 4 to 8%
Chevron 6/14/2018 8/1/2018 up to 9%


IncreaseTimeline6182018R3

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 1

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 2

Click on the Timeline Below to See All Effective Increase Dates in 2018

IncreaseLong6182018

BREAKING NEWS – Shell Claims Shell Rotella Meets The Standards While A Leading Diesel Engine Oil Does Not

BREAKING NEWS – Shell Claims Shell Rotella Meets The Standards While A Leading Diesel Engine Oil Does Not

Shell announced a bold and what you can be sure will be a contentious finding. According to Shell, a sample of Mobil Delvac 1300 Super 15W-40 it examined does not meet API CK-4 performance standards or the more stringent OEM standards claimed for the product.

Shell says, ” When you buy a Shell Rotella® heavy duty engine oil, you rely on our brand to deliver on our promise of protection for your vehicle. That promise is demonstrated by the approvals and specifications that are printed on the label of each Shell Rotella® product.

Shell spends countless hours of work, not only in the laboratory, but also in the real world, to make sure that trust is deserved. Shell also routinely collects and tests competitor oils (competitor benchmarking) to compare our product’s performance against the competition. Recently, Shell ran the industry standard Volvo T-13 test at an independent testing facility using Mobil Delvac 1300 Super 15W-40. The sample was sent blind to eliminate bias.

The Volvo T-13 is a grueling 360-hour, severe high temperature oil oxidation test. The test pushes oil marketers to develop engine oils that are resilient in challenging operating environments of newer, more fuel-efficient engines. The Volvo T-13 is a key barrier against engine oils with inadequate oxidation protection.

The test limits for the Volvo T-13 focus on two standard measurements: Kinematic Viscosity at 40oC (KV 40) in the last 60 hours of the test (ASTM D445) and oxidation by infra-red spectroscopy. These limits are important as they represent the baseline for API CK-4 limits and the more stringent OEM limits. This new test was devised to set the bar for the API CK-4 category of engine oil, designed to include advanced oxidation stability and shear stability.

Oxidation stability of an engine oil refers to its capability to resist thermal and chemical breakdown during engine operation. It is a key indicator of an engine oil’s ability to protect the engine itself and engine hardware.

Using an engine oil that lacks oxidation stability can lead to several engine maintenance and performance issues, such as:

  • Deposit build up on engine parts that can lead to reduced oil drain intervals and shorter engine life
  • More corrosion of engine parts that can lead to greater wear and potentially damage your engine, which could lead to shorter engine life
  • Higher viscosity of oil that can lead to reduced engine efficiency and fuel economy
    End Quote

Shell provided its distributors with the results of the Volvo T-13 tests in support of its claim and according to that data, the sample of Mobil Delvac 1300 15W-40 CK-4 Shell examined “does not meet the minimum API CK-4 requirements or the Volvo/Mack or Cummins OEM requirements.”

CLICK TO SEE DATA


Another Major Moves, and More

Shell Oil Products US (SOPUS) announced it will implement a price increase of up to 10% on its finished lubricants. The increase is effective July 16, 2018. Shell says the increase is due in part to increasing raw material and delivery costs.

Shell is the second major to move in the third round of lubricant price increases in 2018. As reported in the June 5th issue of JobbersWorld, ExxonMobil was the first major to announce a price increase in the third round when it advised its marketers of an increase of up to 10% on finished lubricants, effective July 1, 2018.


Lubriplate Lubricants Company advised its marketers of a price increase on all LUBRIPLATE Brand and FISKE Brand Lubricants. Lubricants based on mineral oil will increase by 7% and synthetic/long-life lubricants will be adjusted up by 4%. The effective date of the increase is August 13, 2018. Lubriplate attributes the increase to the higher cost of base oils, additives, and packaging. The price of SYNXTREME HT MAX, L0331-002 will not be increased.

Round 3 Lubricant Price Increase Summary

Company Announced Date Effective Date Increase
Sinclair Lubricants 5/8/2018 7/1/2018 10 to 12%
Sunoco 5/16/2018 6/16/2018 4 to 6%
Advanced Lubrication Specialties 5/16/2018 6/16/2018 4 to 6%
CAM2 5/18/2018 6/16/2018 4 to 9%
Smitty’s Supply 5/18/2018 6/16/2018 4 to 9%
U.S. Lubricants, Commerce, CA 5/18/2018 6/17/2018 $0.40/gal lubricants
$0.05/lb greases
Axel Royal 5/21/2018 6/24/2018 5%
Chemlube 5/22/2018 6/11/2018 5 to 9%
Maverick Performance Products 5/22/2018 6/18/2018 4 to 8%
Allegheny Petroleum Products 5/23/2018 6/18/2018 6 to 8% on bulk, additional 2% on drums and totes
Warren Distribution 5/23/2018 6/25/2018 4 to 8%
PennStar 5/23/2018 6/15/2018 6 to 10%
Old World Industries 5/24/2018 6/30/2018 4 to 9%
ExxonMobil 6/1/2018 7/1/2018 up to 9%
TOTAL Specialties USA 6/8/2018 7/1/2018 4 to 6%
Nu-Tier Brands/Gulf/ECOSE 6/11/2018 7/13/2018 6 to 8%
Shell 6/13/2018 7/16/2018 up to 10%


IncreaseTimeline6152018R3

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 1

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 2

Click on the Timeline Below to See All Effective Increase Dates in 2018

IncreaseLong652018

Nu-Tier Brands and Total Announces Lubricant Price Increase

Nu-Tier Brands and Total Announces Lubricant Price Increase

Nu-Tier Brands announced that due to rising costs associated with raw materials and manufacturing, Nu-TierBrands/Gulf/ECOSE Lubricants will increase its prices by 6 to 8%. The increase is effective July 13, 2018.


TOTAL Specialties USA announced that effective July 6, 2018, the price of TOTAL branded lubricants will increase by 4 to 6%. The adjustment is reportedly due to the continuing escalation in the cost of base oils, additives, and other materials used in manufacturing and distribution of lubricants.


NOTE: As a point of clarification, although JobbersWorld included Amalie’s recent price increase, announced on May 18, in a table showing companies that have announced in the third round of price increases for 2018, Amalie’s increase was in fact its second for the year, not a third.



JWLubeQuiz

Tractors6112018

And the Winners Are…

JobbersWorld ran a LubeQuiz two weeks ago about two old tractors we recently had the pleasure of seeing in action at a working farm. About these tractors, we asked JobbersWorld readers, how do you check the oil in the tractor shown at the right, and what type of oil is used in that tractor and the one at the below it that is cranked to start?

We received a number of interesting responses. Some right, some not so right, and some that were quite humorous. The winners of the quiz, the ones who got it right are shown below:

Name Company
Erik Dober Jerry Willkomm, Inc./ JWI Transportation
Frank Daul Halron Lubricants
Curtis Grove
Tim Svoboda PetroChoice
Brad VandeBunte J & H Oil Co.
Wayne Hughes TOTAL Specialties USA
Terence Dyson DysonAnalysis

Whereas all the winners said the two petcocks on the oil pan are used to check the oil level, one answer in particular sounded like it came right from the farmer’s mouth that we visited. This answer was from Tim Svoboda with PetroChoice. Tim said, “The tractor has two petcocks to check oil. It is always best to check oil after the tractor idled for a few minutes. The upper petcock would drain until it dribbled, close it, then the tractor has enough oil in it. When adding 30W to this age of tractor, most farmers had to use a glass-quart-Mason jar with a screw on metal funnel.”

With regards to both how to check the oil and the viscosity grade used, Erik Dober from Jerry Willkomm/JWI Transportation summed it up by saying, “Check oil level on the side of the oil pan. Two petcocks on side, lower is your low oil level, upper is full. Oil used should be: Above 80°F use SAE 30, 32°F to 80°F use SAE 20, and below 32°F use an SAE 10.”

For those unfamiliar with this tractor, it’s an International Harvester Farmall Tractor. Other than saying it was from the “40s,” the farmer did not know the age, but he sure knows how to keep this one and all the other tractors on the farm running.

Congratulations to the winners!

Round 3 Lubricant Price Increase Summary

Company Announced Date Effective Date Increase
Sinclair Lubricants 5/8/2018 7/1/2018 10 to 12%
Sunoco 5/16/2018 6/16/2018 4 to 6%
Advanced Lubrication Specialties 5/16/2018 6/16/2018 4 to 6%
CAM2 5/18/2018 6/16/2018 4 to 9%
Smitty’s Supply 5/18/2018 6/16/2018 4 to 9%
U.S. Lubricants, Commerce, CA 5/18/2018 6/17/2018 $0.40/gal lubricants
$0.05/lb greases
Axel Royal 5/21/2018 6/24/2018 5%
Chemlube 5/22/2018 6/11/2018 5 to 9%
Maverick Performance Products 5/22/2018 6/18/2018 4 to 8%
Allegheny Petroleum Products 5/23/2018 6/18/2018 6 to 8% on bulk, additional 2% on drums and totes
Warren Distribution 5/23/2018 6/25/2018 4 to 8%
PennStar 5/23/2018 6/15/2018 6 to 10%
Old World Industries 5/24/2018 6/30/2018 4 to 9%
ExxonMobil 6/1/2018 7/1/2018 up to 9%
TOTAL Specialties USA 6/8/2018 7/1/2018 4 to 6%
Nu-Tier Brands/Gulf/ECOSE 6/11/2018 7/13/2018 6 to 8%


IncreaseTimeline6112018R3

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 1

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 2

Click on the Timeline Below to See All Effective Increase Dates in 2018

IncreaseLong652018

Four More Up Prices

Warren Distribution announced a price increase of 4 to 8% on all lubricant products, depending on the product and package size. The new prices will go into effect with shipments on or after Monday, June 25, 2018. Warren Distribution sites several factors driving the announced increase. One is the continued rise in the price of base oils in response to higher crude oil prices. Additionally, it says, acquiring timely transportation services have become more difficult, so freight rates have significantly escalated. Lastly, rising steel prices have caused a precipitous increase in drum costs.


Allegheny Petroleum Products  announced a price increase of 6% to 8% on bulk lubricants and an additional 2% on drum and tote packaging, depending on the product. Allegheny attributes the price change to the ongoing base oil, additive, and packaging cost increases that continue to occur industry wide. The price change will be effective on orders placed on or after June 18, 2018.


Maverick Performance Products advised its customers that due to multiple increases in raw materials used in the manufacturing of finished lubricants, Maverick Performance Products will be passing through a price adjustment on VP finished lubricants of approximately 4 to 8%, percentages will vary by product. The increase will be effective on orders placed on or after June 18, 2018.


Old World Industries announced that it will raise the price on all finished lubricants by 4% to 9%. The increase is effective June 30, 2018. Old World says the increase is a result of the continued increase in the cost of raw materials used in the manufacturing and distribution of these products.

See table and chart below for complete list of recent price increases JobbersWorld reports. 

Dennis K Burke Becomes Northeast Distributor for Phillips 66/Kendall Lubricants

Dennis K Burke announced that it is now the Phillips 66/Kendall Lubricants distributor for the Northeast. The company says, “Kendall has been on the forefront of advances in lubricant product technology since the early 1900’s and we are excited to be able to offer their premium, cutting edge products to our customers.”

SOURCE Dennis K. Burke, Inc.


Shell Launches Artificial Intelligence Chatbot For B2B Lubricants Customers and Distributors

Shell Lubricants has introduced Shell LubeChat, the first artificial intelligence (AI)-powered chatbot tool for B2B lubricants customers. Shell LubeChat is an online chat robot that is designed to give users around the world easy, real-time access to product support, technical services and lubricants data. Currently available in the United States, China and India, this service will also launch in the United Kingdom in the coming weeks and other markets later in the year.

BlogPic1234“Customers and distributors are at the heart of our business here at Shell. We are continually investing in new solutions and services that make their lives easier and more convenient, and we expect digital platforms to play a key role moving forward,” said Roger Moulding, Vice-President of Shell Lubricants Marketing.

Shell LubeChat can be used across a wide range of businesses and sectors, including general manufacturing, construction, agriculture, power and fleet. Designed to help optimize efficiency for our customers and distributors, Shell LubeChat, alongside the entire suite of Shell Lubricants Services, can help solve day-to-day challenges like obtaining access to information quickly. The platform is equipped to help users in a variety of ways, including finding the right product for their equipment, accessing Technical and Safety data sheets on Shell Lubricants products, learning through case studies how others have helped improve their operations with Shell Lubricants products, getting the recommended Shell alternative to other products in the market, and finding authorised distributors closest to them. More

Valvoline to Acquire Great Canadian Oil Change, its First International Quick-Lube Acquisition

Valvoline Inc., a leading worldwide supplier of premium branded lubricants and automotive services, announced that it has signed a definitive agreement to acquire the business assets of Great Canadian Oil Change, which franchises 73 quick-lube stores in five Canadian provinces, primarily in British Columbia and Saskatchewan. The acquisition is expected to be completed within 60 days. Financial terms were not disclosed.

Great Canadian Oil Change, based in Chilliwack, British Columbia, was founded in 1978 and is the third largest quick-lube system in Canada. The acquisition will expand Valvoline’s existing quick-lube network to more than 1,200 company-owned and franchised locations.

“Growing and strengthening our quick-lube network through organic store expansion and high-quality acquisitions in both core and new markets is a key business strategy for Valvoline,” said Sam Mitchell, chief executive officer. “The addition of Great Canadian Oil Change, with its established brand – which we intend to keep in place – and loyal customer base, provides us with an excellent opportunity to expand our quick-lube footprint outside the U.S.”

“Owners Trevor and Carolynn Weflen have spent 40 years developing the Great Canadian Oil Change brand and building its reputation in the Canadian marketplace,” said Tony Puckett, president, Valvoline Quick Lubes. “We’ve developed a strong relationship with Great Canadian Oil Change over the years through our Canadian installer business team and blending and packaging plant in Mississauga, and look forward to working with Great Canadian Oil Change’s large and experienced franchise-owner base to further grow and improve the business. We believe there is significant opportunity for system growth through both support of franchisees and company-owned store expansion.”

“Great Canadian Oil Change has been part of our family since 1978, and we are extremely proud of the brand we’ve built and the growth we’ve achieved,” said Trevor Weflen, owner of Great Canadian Oil Change. “Although the decision to sell was difficult, we are very confident that Valvoline is the right steward for the Great Canadian Oil Change brand and our franchisees going forward. Valvoline is a 150-year-old company that has a long, successful history of taking care of its people, franchisees and customers. We know Valvoline is dedicated to the growth and success of the brand and every franchisee.”


LubeQuiz
Where’s the Dipstick?

 

20180428_144602I recently visited a working farm and had the pleasure of seeing a number of old farm tractors that, in spite of their age, were still pulling their weight and significantly more. One of the more intriguing tractors was the one to the right. When asked when this tractor last ran, I was told to sit in the seat, shake the shifter to make sure it was not in gear, pull out the knob on a steel plate, and advance the throttle a bit. The farmer than turned a petcock to open a gas line and engaged a crank in the front of the engine. After giving it only one hard crank, the engine came to life and was purring like a kitten; no smoke, knocking, pinging, clicking, clacking, spitting or sputtering. And after a short ride in the field, it was clear that this was, aside from its age and rusty appearance, a well-maintained machine that was built to last.

The next interesting experience came when I asked how to check the oil in the tractor below, since, for the life of me, I could not figure it out. Whereas I was schooled on the basics of vintage tractors when he showed me how to check the oil, I wonder how many in our industry would know.

-Tom Glenn

LubeQuiz
  1. How do you check the oil level in this tractor?
  2. As a bonus, what type of oil do you think is used in this tractor and the one that he cranked to start?

JobbersWorld will publish the names and the companies they work for of the first three who get it right. Send your answers to lubequiz@jobbersworld.com.

20180428_144840

Round 3 Lubricant Price Increase Summary

Company Announced Date Effective Date Increase
Sinclair Lubricants 5/8/2018 7/1/2018 10 to 12%
Sunoco 5/16/2018 6/16/2018 4 to 6%
Advanced Lubrication Specialties 5/16/2018 6/16/2018 4 to 6%
CAM2 5/18/2018 6/16/2018 4 to 9%
Smitty’s Supply 5/18/2018 6/16/2018 4 to 9%
U.S. Lubricants, Commerce, CA 5/18/2018 6/17/2018 5 to 9%
Axel Royal 5/21/2018 6/24/2018 5%
Chemlube 5/22/2018 6/11/2018 5 to 9%
Maverick Performance Products 5/22/2018 6/18/2018 4 to 8%
Allegheny Petroleum Products 5/23/2018 6/18/2018 6 to 8% on bulk, additional 2% on drums and totes
Warren Distribution 5/23/2018 6/25/2018 4 to 8%
Old World Industries 5/24/2018 6/30/2018 4 to 9%

IncreaseTimeline5242018R3

 CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 1 

CLICK FOR COMPLETE LIST OF LUBRICANT PRICE INCREASES IN 2018 ROUND 2

Click on the Timeline Below to See All Effective Increase Dates in 2018

TimelineLong5222018

Update: U.S. Lubricants Price Increase

Understanding there is more than one company with the name U.S. Lubricants operating in the US, to avoid confusion, please note that the U.S. Lubricants price increase JobbersWorld reported on yesterday is for U.S Lubricants, located in Commerce, California. This is not the same company, nor is it associated with U.S. Lubricants in Appleton, Wisconsin, a division of U.S. Venture, Inc., a privately-owned leader in the distribution of fuels (diesel, gasoline, biofuels, and compressed natural gas), passenger and commercial vehicle tires, parts, and other transportation products, as well as passenger car, commercial/heavy duty, industrial, and metalworking lubricants.

Add Two More to Round 3 and One More to Round 2 of Price Increases; Promotion of Gina Harm to President, Afton Chemical

Add Two More to Round 3 of Price Increases

CAM2 announced on May 18th that due to the continued increases in base oil, additives, and freight that it will be implementing a price increase of 4 to 9% on its bulk and packaged lubricants, greases, and brake fluid. The increase is effective June 16, 2018.

Smitty’s Supply announced on May 18th it will implement a 4 to 9% price increase on all its oils, fluids, greases, and brake fluid products effective June 16, 2018. Smitty’s attributes the increase to the continued increases of base oils, additives, and freight associated with the manufacturing and distribution of its products.

See the bottom of page for a complete table of all price increases reported by JobbersWorld in Round 3, 2018.

Add One More to Round 2 of Price Increases

D-A Lubricants announced on May 15, 2018, it will be implementing a price increase on its lubricants and greases by up to 10%. The increase goes into effect on June 11, 2018. D-A Lubricants attributes the price change to the rising raw material costs associated with manufacturing and distribution of its products.


Promotion of Gina Harm to President, Afton Chemical

NewMarket Corporation announced that Ms. Regina A. Harm has been appointed President of Afton Chemical Corporation.

JWQuote5212018Ms. Harm has over 30 years of experience in the chemical industry including 11 years with Afton Chemical. For the past 3 years, she has held the position of Senior Vice President and Chief Operating Officer of Afton Chemical. In this role, Ms. Harm was responsible for the procurement, engineering, manufacturing and logistics of Afton Chemical’s global product portfolio as well as Research and Development functions. Ms. Harm will replace Mr. Robert A. Shama who has been appointed Vice President of Strategic OEMs (Original Equipment Manufacturers) for Afton Chemical.

Mr. Teddy Gottwald, Chairman and CEO of NewMarket commented, “There is an exciting opportunity ahead as Gina embeds her extensive knowledge of the market, strong leadership skills and results driven mindset to accelerate our growth strategy. We remain focused on our long term objectives and I look forward to our continued success under Gina’s direction.”

NewMarket Corporation, through its subsidiaries Afton Chemical Corporation and Ethyl Corporation, develops, manufactures, blends, and delivers chemical additives that enhance the performance of petroleum products. From custom-formulated additive packages to market-general additives, the NewMarket family of companies provides the world with the technology to make engines run smoother, machines last longer, and fuels burn cleaner.

Round 3 Lubricant Price Increase Summary

Company Announced Date Effective Date Increase
Sinclair Lubricants 5/8/2018 7/1/2018 10 to 12%
Sunoco 5/16/2018 6/16/2018 4 to 6%
Advanced Lubrication Specialties 5/16/2018 6/16/2018 4 to 6%
CAM2 5/18/2018 6/16/2018 4 to 9%
Smitty’s Supply 5/18/2018 6/16/2018 4 to 9%

 

More Third Round Price Increases

More Third Round Price Increases

Sinclair Lubricants was the first to move with a third round of price increases for 2018 when it announced on May 8th it will be implementing a price increase of up to 10% to 12% on finished lubricant products effective July 1, 2018. Click for details.

Now there are two more with a third round of price increases.

Advanced Lubrication Specialties (ALS) announced today it will be implementing a price increase on most finished lubricants between 4 and 6%. The increase goes into effect on June 4, 2018. ALS attributes the price change to the continued increases in the base oil market.

Sunoco Lubricants announced today that effective June 4, 2018 it will be implementing a price increase on most finished lubricants between 4 and 6%. Sunoco also attributes the price change to the continued increases in the base oil market.

Watching the Spread

The price spread between crude oil (WTI) and base oil (100N Group II) averaged $1.30 a gallon from January 1, 2017 to May 15, 2018. What this means is that if crude was trading at $x/gal, on average, base oil would sell for “x” plus $1.30/gal during that period. Generally, for base oil producers, the greater the spread the better the day. This is because when the spread is high, base oil producers enjoy higher margins. When it’s low, not only do they see lower margins, they feel pressure from their upstream refining businesses to increase the price of base oil or run the risk of alternative value economics favoring the use of base oil feed to produce fuels rather than base oils.

Base oil spreads are important to watch. The spreads provide lubricant blenders and marketers with a predictive tool to forecast movements in base oil and finished lubricant prices. In some respects, spreads can be looked at as an early alarm. Because when the spread drops below a certain threshold, we typically see base oil prices increase, which in turn, result in price increases on finished lubricants.

There have been two periods with notable increases in the crude and base oil spread in 2018, as shown below. These were accompanied by a number of base oil price increase announcements and, not surprisingly, they were followed by announced increases in the price of finished lubricants.

CrudePic5162018

Gen III Oil Corp. Announces Initial Analyst Coverage Report by Canaccord Genuity Corp.

Gen III Oil Corporation announced that Canaccord Genuity Corp. “Canaccord” – a Vancouver, Canada headquartered investment dealer, has published an initial equity analyst research report on the Company.

The research report dated May 10, 2018, entitled “Gen III Oil Corporation. – Initiation of Coverage: An industry-disrupting oil change.” was written and produced by Associate Analyst, Kimberly Hedlin, CPA, CMA, as an independent analysis of Gen III’s activities and progress. Click for More

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Sinclair Announces Price Increase – Attributes to SN PLUS

Sinclair Lubricants Announces Price Increase

There has been a good deal of talk in the industry over the past few weeks about the potential for a third round of lubricant price increases in 2018. The concerns are driven by the recent upward movement in the price of base oils. Sinclair Lubricants responds with the first of a third for 2018.

Sinclair Lubricants will be implementing a price increase of up to 10% to 12% on finished lubricant products effective July 1, 2018. In certain instances, the amount of the price change may fall outside of these parameters. Sinclair Lubricants says this adjustment is due to increasing costs of base oil, freight increases, and certifying all products to API SN PLUS.

As previously reported by JobbersWorld, there have already been two rounds of price increases in 2018. The first began with announcements by majors and independent blenders in January. Most of these increases were in the range of 6 to 10% with effective dates in February and March. A second round of increases started with an announcement on February 12th by Sinclair Lubricants that its lubricant prices would increase by up to 5%. Both the first and second round of increases announced by Sinclair had the same effective date of March 1, 2018.

The U.S. Withdraws from Iran Nuclear Deal – Impact on Base Oil

Price increases are not unusual in the lubricants business. In fact, we typically see two to three a year. In most cases the increases are somewhat predictable since they are often driven by changes in the price of crude oil and its impact on base oil prices. This is logical since crude oil is the feed for base oil and base oil accounts for about 75 to 99% of the volume of material in finished lubricants and roughly 50 to nearly 100% of its cost. The balance of the cost of goods belongs to performance additives, which are also impacted by higher base oil prices.

Understanding the impact base oil costs have on the lubricant prices, it’s import to consider how today’s announcement that the U.S. will withdraw from the 2015 Iran nuclear deal can impact crude, and therefore lubricant prices.

Specific to the U.S. withdrawing from the Iran deal, President Trump said, “We will be instituting the highest level of economic sanction,” and that “Any nation that helps Iran in its quest for nuclear weapons could also be strongly sanctioned by the United States.” Although the action is clear, the reactions are not, and therein lies the uncertainty about how this will effect the price of crude.

Considering that Iran is OPEC’s third-largest oil producer and exports close to 2.5 million barrels of crude a day, one obvious scenario is that the sanctions will result in tightening the supply of crude in a global supply and demand pool that is fairly balanced. Such tightening would push crude prices higher and consequently, drive base oil and lubricant prices up. There is, however, a good deal of uncertainty around this scenario. Most uncertain is how Iran, US allies, other countries and the markets will react to the actions taken today.

Of particular interest are reactions to the statement made by Treasury Secretary Steven Mnuchin following the U.S. withdrawing from the deal, saying “Sanctions will be reimposed subject to certain 90 day and 180 day wind-down periods. At the conclusion of the wind-down periods, the applicable sanctions will come back into full effect.” This statement sends a clear message that there is time for all involved to absorb and assess how the withdraw and sanctions could impact their interests and how they will react to them.

You can be sure all those in the lubricants business will be keeping a close eye on how this one plays out. But in the meantime, you can also be sure the industry is thinking hard about base oil price increases they have already seen this year and how they have effected margins.

BaseOilSpread

Trucking Firms Deploy Ultra Clean Near-Zero RNG Trucks at Ports of Long Beach and Los Angeles

Clean-Truck---updated

(Photo: Business Wire)

Clean zero-emissions trucks are being deployed in CA ports to improve air quality.

Six trucking firms operating in the Ports of Los Angeles and Long Beach are deploying trucks powered by Cummins Westport (CWI) near-zero ISX12N engines, and fueled with Clean Energy Fuels Corp.’s Redeem™ brand renewable natural gas (RNG) in an effort to reduce emissions and improve air quality in the ports and surrounding communities.

The project’s goal is to introduce this ultra clean technology, which is 90 percent to 99 percent cleaner than existing port trucks, to the port drayage industry. This project aims to inspire greater interest in near-zero RNG trucks, particularly with the incentive funding that California is providing to help truckers transition to this clean technology. Near-zero trucks are also one of the strategies for reducing emissions from trucks under the ports’ recent update to their Clean Air Action Plan (CAAP).

“The realization by trucking companies that they need to do something to meet the upcoming and anticipated stricter emissions requirements in California is beginning to settle in,” said Greg Roche, Clean Energy’s vice president of sustainable trucking. “Fortunately, there are many ways to take advantage of grants and other resources to make the transition to the new engine technology and clean RNG virtually painless. We applaud these first-movers in being leaders in doing their part to make the air we all breathe cleaner.”

The California Energy Commission and the South Coast Air Quality Management District provided funding for 20 near-zero Class 8 trucks. The Ports of Los Angeles and Long Beach provided funding for two additional near-zero trucks. The first four near-zero trucks have been successfully operating since mid-2017 and an additional four have been operating since February 2018.

“The California Energy Commission is pleased to have supported the deployment of near-zero emissions trucks powered by Cummins Westport’s advanced engines with our partners, the South Coast Air Quality Management District and Clean Energy,” said Energy Commissioner Janea A. Scott. “Demonstration projects, like those being carried out by the Ports of Los Angeles and Long Beach, help show there are viable cleaner, more sustainable freight technologies available today and highlight the role these technologies can play as the State transitions to zero and near zero emission technologies to help achieve federal air quality standards and the state’s greenhouse gas goals.”

Project participants include Total Transportation Services, Inc. (TTSI), 4Gen Logistics, Orange Avenue Express, CR&R, and Pacific 9 Transportation.

The ultra clean CWI engines achieve the lowest emissions of any heavy-duty engine used in any truck in North America, yet deliver diesel caliber performance with reliability and durability.

The U.S. Environmental Protection Agency (USEPA) and California Air Resources Board (CARB) certified these engines in December 2017 at CARB’s optional low-NOx standard of 0.02 g-NOx/bhp-hr, 90 percent lower NOx emissions than the current EPA NOx standard. In fact, the new engines were tested as low as 0.01 g-NOx/bhp-hr, achieving virtually zero tailpipe emissions. Factory production of ISX12N engines began in February and they are soon expected to be powering many more trucks on California roads.

“TTSI has now been testing the new CWI natural gas engines since last year and have found that they work terrifically,” said Vic LaRosa, President of TTSI. “We have run the trucks hard – in and out of the ports for long hours in all kinds of conditions – and have had no issues. TTSI is committed to going above and beyond what we can towards a more sustainable future and transitioning to renewable natural gas has made it easy.”

All these trucks will be fueling at Clean Energy’s network of California stations with Redeem fuel, which reduces greenhouse gas (GHG) emissions by 70 percent versus diesel. RNG is the cleanest fuel for trucking today, with some GHG sources even reducing GHG by over 100 percent.

Pacific 9 Transportation will soon deploy 20 other RNG-powered trucks in addition to their grant-funded ultra low-NOx trucks.

The Ports of Los Angeles and Long Beach enacted the latest version of their CAAP in November 2017, which adopts far reaching strategies to further reduce air emissions and support California’s vision for more sustainable freight movement. Part of the CAAP could dramatically change the makeup of the 16,000 heavy-duty trucks that move in and out of the ports. The CAAP envisions transitioning the current fleet of port trucks to clean trucks through a new set of provisions that will begin to be implemented this year.

About Clean Energy
Clean Energy Fuels Corp. is the leading provider of natural gas fuel and renewable natural gas (RNG) fuel for transportation in North America. We build and operate compressed natural gas (CNG) and liquefied natural gas stations (LNG) and deliver more CNG, LNG and RNG vehicle fuel than any other company in the U.S. Clean Energy sells Redeem RNG fuel and believes it is the cleanest transportation fuel commercially available, reducing greenhouse gas emissions by up to 70%. For more information, visit www.CleanEnergyFuels.com.

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