2018: Off to an Interesting Start

The Year is Off to an Interesting Start

Additive and Now Base Oil Increases

As discussed in the December 27th issue of JobbersWorld, the big four lubricant additive manufacturers recently announced price increases in the range of 5 to 8%. The increases impact the cost of both VI and DI additives and when taken together, they bump the cost of goods to manufacturer motor oils up by roughly 8 to 10 cents per gallon (cpg). Likewise it increases the cost of most other lubricants at amounts dependent on the product types, treat rates and other variables. But there is more.

In addition to additive price increases, the new year also started off with announced increases in the price of base oil. Although additional increases are likely, those already announced in 2018 move the price of some of the workhorse base oils up by close to 10 cents a gallon.

With the price of both base oils and additives going up at roughly the same time and collectively adding at least another 20 cpg to the cost of good, you can be sure lubricant blenders and marketers are working their spreadsheets and evaluating various courses of action. And beyond taking into account the higher price of base oil and additives, you can be sure increases in packaging, transportation costs and others are also being reviewed.

So once again, hang on to your hats, 2018 looks like it’s off to an interesting start.

New CITGO CEO Arrives in Houston

CITGO President and CEO Asdrúbal Chávez conducted his first corporate meeting yesterday with top senior executives and management to review the Company’s 2017 results, including the record-setting safety performance and operational achievements.

Building on this momentum into 2018, CITGO will continue to emphasize excellence in all aspects of its operations to enhance competitiveness within the oil industry and support the hundreds of locally owned and operated marketers and retailers across the United States. Mr. Chávez, a chemical engineer, arrives at the CITGO headquarters in Houston with more than 30 years of industry experience and plans to unveil his vision for the future of the Company over the coming months.

CITGO Petroleum Corporation, based in Houston, is a refiner, transporter and marketer of transportation fuels, lubricants, petrochemicals and other industrial products. The company is owned by CITGO Holding, Inc., an indirect wholly owned subsidiary of Petróleos de Venezuela, S.A., the national oil company of the Bolivarian Republic of Venezuela. For more information, visit www.CITGO.com.

Source: CITGO

BP and Castrol Announce Extension of Global Strategic Partnership With Volkswagen Group

BPCASTROLVWPICBP and Castrol announced the renewal of their successful 17 year global strategic partnership agreement with Volkswagen Group for the supply of fuels and lubricants globally.

The agreement covers Volkswagen PC, Audi, Seat Skoda and Volkswagen LCV. Within the partnership a new Castrol and Volkswagen jointly branded engine oil has been co-engineered with Volkswagen group and will be launched soon. As technology partners, the two companies will continue their close collaboration in joint research and development to improve fuel efficiency and generate innovative future mobility solutions.

Oliver Rose, VP BP Global Accounts said: “For 17 years we have had an extremely successful partnership with the Volkswagen Group. We will continue working together to ensure the millions of drivers of Volkswagen Group vehicles get the best performance and protection.”

Commenting on the agreement, Imelda Labbé, head of Volkswagen Group After Sales worldwide said: “Volkswagen has had a long and successful partnership with Castrol. This powerful combination of our brands will reinforce the natural fit of our high quality standards and reputation. We are delighted to extend this partnership and look forward to working together.”

Source: Castrol

Sayle Oil Recognized as Master Certified Distributor

Sayle Oil was recently recognized by Shell Lubricants as a Master Certified Distributor. This designation signifies Sayle Oil’s loyalty to the Shell brand and the relationship the two companies share. Sayle says, “It is more than just a title. This new designation comes after years of growing in our target markets. Because we are the only Master Certified Shell distributor in our area, we can better serve our customers and continue to stay on top of the dynamics in the transportation industry.” Click for More

About Sayle Oil Company
For over 70 years, Sayle Oil Company has been the leading distributor of lubricants, fuels, and propane in the mid-South. The company offers a vast range of products in a multitude of applications including agriculture, industrial, transport, and consumer. Sayle Oil has the capabilities and resources to service your company – from product delivery to equipment inspection and oil analysis – as well as everything in between. This full spectrum of products and services makes us your ONE STOP SHOP for all things petroleum.

Add CITGO and Valvoline to Round 2

Effective May 15, 2017, CITGO will implement a general price increase of up to 4% to 6% on its branded and private label lubricants. CITGO  says the increase is driven primarily by escalations in base oil and additive costs occurring over the past several months.

Valvoline announced an increase of up to 4% on its branded lubricant products. This increase takes effect June 1, 2017. Valvoline attributes this adjustment to increases in the cost of raw materials and higher manufacturing and distribution costs.

The average time from the date the lubricant manufacturers JobbersWorld reported on in Round 2 – 2017 to the effective date of the increases is 20 days. Interestingly, there is a significant difference in the number of days from announcement to effective dates between the majors and other blenders, as illustrated below and shown in Table 1.




Table 2

IN ROUND 2 OF 2017

Lubricant Manufacturers Round 2

Company Announced
Amalie 3/17/2017 4/21/2017 24 cpg lubes, 3 cpp grease
Calumet 3/20/2017 4/20/2017 4 to 6%
Castrol (excluding industrial) 3/22/2017 5/1/2017 up to 3%
CAM2 3/23/2017 4/17/2017 20 to 35 cpg
Warren Distribution 3/24/2017 4/24/2017 6 to 9%
Smitty’s Supply 3/24/2017 4/24/2017 4 to 6%
Chemlube 3/27/2017 4/20/2017 4 to 7%
Pinnacle Oil 3/28/2017 4/18/2017 5 to 9%
Reliance Fluid Technologies (RFT) 3/28/2017 4/28/2017 6 to 9%
Old World Industries (PEAK) 3/28/2017 4/21/2017 up to 8%
Allegheny Petroleum 3/28/2017 4/17/2017 20 to 35 cpg
Warren Oil Company 3/28/2017 4/24/2017 4 to 9%
Kleen Performance Products 3/29/2017 4/17/2017 5 to 12%
ExxonMobil 3/31/2017 5/10/2017 up to 4%
Chevron 4/3/2017 5/15/2017 4 to 6%
Advanced Lubrication Specialties (ALS) 4/3/2017 4/24/2017 5 to 9%
Nu-Tier Brands 4/4/2017 4/24/2017 4 to 7%
Phillips 66 4/5/2017 5/10/2017 4 to 6%
Petro-Canada 4/5/2017 5/5/2017 up to 6% (excluding white oils and process oil)
SOPUS/Shell 4/10/2017 5/15/2017 up to 4%
CITGO 4/11/2017 5/15/2017 4 to 6%
Valvoline 4/11/2017 6/1/2017 up to 4%


2017 Price Increase Timeline – Lubricant Manufacturers
Round 2

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