PAG Base Oil Market - Forecast(2023 - 2028)

Report Code: CMR 36480 Report Format: PDF + Excel

PAG Base Oil Market Overview

PAG Base Oil market size is estimated to reach US$1.9 billion by 2027, after growing at a CAGR of 3.7% from 2022 to 2027. Polyalkylene glycol or PAG is a synthetic base oil which is available in both water soluble & insoluble form, and provide quality lubricity, high natural viscosity index and good temperature stability. The base oil is used in automobile & refrigerator compressor along with polyether for air conditioning, in aerospace air compressor application, as petroleum refined oil substitute, as metal working fluids and hydraulic fluids. Soluble PAG base oil have hydrophilic molecule which makes them soluble in water, which allows easy clean-up of equipment. Factors like increase in production scale of aircrafts, growing demand of automotive vehicles, growing construction activities and high demand of textile items is driving the growth of PAG base oil market. However, PAG base oil is chemically derived from crude oil, and the volatility in the crude oil prices can have negative impact on the production volume of Grade V synthetic base oil like PAG. Hence, this can hamper the growth of PAG base oil industry. 

COVID-19 Impact

Various countries across the world, in order to prevent the widespread of COVID-19, have implemented necessary measures like consequential lockdown, quarantining, restriction on public movement, and regulation on logistics. This caused lack of availability of labor workforce and raw materials in factories and plants, which disrupted the functionality of major end users of PAG base oil like automotive, aerospace, and heavy machinery equipment in construction sector. For instance, as per the International Organization of Motor Vehicle Manufacturing, in 2020 there was a 16% global decline in vehicles production i.e., less than 78 million vehicles were produced. Also, as per International Construction and Infrastructure Surveys, the construction and infrastructure activities across all regions went down in Q1 of 2020 with China in the Asia-Pacific region having the sharpest workload contraction. Moreover, as per the 2021 report of the General Aviation Manufacturers Association, the Global business jet deliveries declined 20.4% to 644 aircraft in 2020 due to the COVID-19 pandemic. PAG base oil is used as compressor oil, gear oil, hydraulic fluids in automotive & construction vehicles, as lubricant & air compressor in aircrafts. Hence, the decrease in productivity of these sectors led to decrease in usage of PAG base oil in them, which negatively impacted the growth of PAG base oil industry.

Report Coverage

The report: “PAG Base Oil Market Report – Forecast (2022 – 2027)”, by IndustryARC, covers an in-depth analysis of the following segments of the PAG Base Oil Industry.

By Form – Water Soluble, Water Insoluble, and High Viscosity Thickeners.
By Application - Anhydrous Fire-Resistant Hydraulic Oil, Gear Oil, Engine Oil, Metal Working Fluids, Compressor Oil (Air Compressor Oil, Refrigerator Compressor Oil, and Gas Compressor Oil), Textile lubricant, Food-grade lubricant, and Others.
By End UserConstruction (Draglines, Crane, Bulldozer, Dump trucks, Scrapper, Others), Automotive (Passenger Cars, Heavy Vehicles, Light Vehicles, Others), Aerospace (Commercial Liner, General Liner, Passenger Liner, Military & Choppers), Agriculture (Tractors, Harvesters, Balers, Harrows, Other), Textiles, Food & Beverage, and Others.
By Geography - North America (USA, Canada, Mexico), Europe (UK, Germany, France, Italy, Netherland, Spain, Russia, Belgium, Rest of Europe), Asia-Pacific (China, India, Japan, South Korea, Australia, and New Zealand, Indonesia, Taiwan, Malaysia, Rest of APAC), South America (Brazil, Argentina, Colombia, Chile, Rest of South America), Rest of the World (Middle East, Africa).

Key Takeaways

  • Asia-Pacific dominates the PAG base oil industry, as the region consist of major end users of the synthetic lubricant like automobiles, textiles, construction sector in major economies like China, India, Japan, South Korea
  • In refrigeration compression, PAG and polyether lubricants are used exclusively with the current generation of environmentally friendly HFC refrigerants such as R-134a and R-152a
  • The superior heat transfer characteristics, thermal and oxidation stability of PAG base oil make them ideal for use as heat transfer fluids and process fluids in production of plastics, elastomers, threads & fabricated parts

Figure: Asia-Pacific PAG Base Oil Market Revenue, 2021-2027

PAG Base Oil Market

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PAG Base Oil Market Segment Analysis – By Form

Water soluble held a significant share in PAG base oil market in 2021, with a share of over 36%. Water soluble PAG lubricants has high viscosity index, good temperature adaptability and can accommodate high water content than mineral oil-based lubricant without corrosion. Hence, due to such unique features such type of PAG base oil are used as hydraulic fluid, quenching fluids, gear oils in industrial equipment like automotive and construction equipment. The rapid development in these sectors has increased their scale of productivity, which has positively impacted the demand for PAG base oil. For instance, as per European Automobile Manufacturers Association, the production and registration of passenger cars in the EU increased by 53.4% in 2021 with strong volume seen in Spain, France, Germany. Also, as per the 2021 report of the U.S Census Bureau, construction activities in the U.S have steadily increased, with residential construction showing an increase of 4.1% in November, compared to 2020. The increase in productivity of automobile and construction sector will increase usage of water soluble PAG base oil having high hydrophilic molecule in automotive vehicles and in heavy construction equipments like dump trucks, draglines for lubrication. This will have positive impact on the growth rate of PAG base oil industry.

PAG Base Oil Market Segment Analysis – By End User

Automotive sector held a significant share in PAG base oil market in 2021, with a share of over 25%. PAG base oil is used as compressor oil along with polyether in air conditioning system of cars, as hydraulic oil on brakes, clutches, power steering system and as engine oil it helps control friction and wear of automotive engines. The increase in disposable income, improvement in living standards and rapid urbanization has led to increase in demand for new vehicles, which has increased the productivity scale of automotive vehicles. For instance, as per the November 2021 report of Europe Automobile Manufacturer Association, the new passenger car registration in the first ten months of 2021 increased up to 2.2% with an increase shown in European Union markets like Italy showed 12.7%, Spain showed 5.6% and France showed 3.1%. Such increase in consumption of automotive vehicles will lead to increase in their production scale, which will increase the usage of PAG base oils like compressor oil, hydraulic fluids and engine oil for automotive parts and air-cooling system. Hence, this will positively impact the growth of PAG base oil industry.  

PAG Base Oil Market Segment Analysis – By Geography

Asia-Pacific held the largest share in PAG base oil market in 2021, with a share of over 27%. The region consists of major end users of PAG base lubricants like automotive, construction, textile and plastics sector in major economies like China, India, Japan, with China being the largest producer of automobiles and textiles. The economic development along with growing investments in these nations has increased the industrial output of their sectors including end-users of PAG base oil. For instance, as per the International Organization of Motor Vehicle Manufacturing, the global production volume of vehicles increased to 57 million in 2021 from 52 million in 2020, with Asia accounting for 50% of production. Also, as per the Indian Brand and Equity Foundation, the automobile sector in India attracted FDI worth US$30.51 billion between April 2000 and June 2021. Moreover, as per China Electronic Information Industry Development, the country is expected to spend US$1.4 trillion on new infrastructure projects between 2020-2025, including investments in renewable energy and residential buildings. PAG base oil are used for lubrication, removal or heat and sealing of pistons in automotive vehicles and heavy construction machinery. Hence, the increase in automobile production and undertaking of new construction projects will lead to more usage of PAG base oils in automobile and construction equipment, which will positively impact the growth of PAG base oil industry.

PAG Base Oil Market Drivers

Growing Scale of Aircraft Production

PAG base oil as compressor oil is used in aerospace air compressor application like potable water supply on aircraft, electronic and galley cooling, aircraft engine manufacturing, semiconductor process gas handling etc. Moreover, PAG base oil is used as substitute for petroleum refined oil in aircrafts when they operate in extreme temperature. The growing demand for aircraft and their components in the regions like Europe & North America has increased the production volume of major aircraft manufacturers like Airbus & Boeing. For instance, in 2021 Airbus increased the production rate of A320 Family aircraft from 43 aircraft in Q3 to 45 in Q4, and it increased the monthly production rate of A322 from 5 to 6 aircraft per month in Montreal, Quebec, Mobile. Also, in 2020, Boeing was the major producer of wide-body planes with a total unit of 224 followed by Airbus 147 units. Such increase in aircraft production will increase the usage of PAG base oil in aerospace air compressor application, thereby providing boost up to growth rate of PAG base oil industry.

High Demand for Textiles

Textile industry is another major user of PAG base oil as such oil is used as extreme pressure lubricants in many high speed & temperature fibers processes where shear stability is a required. Having hydrophilic molecule make the lubricant not to stain or discolour fibre and are easily removed during scouring process. The increase in the volume of textile manufacturing on account of high demand for textile items like clothing and apparels etc. will have a positive impact on the demand for PAG base oil in the textile sector. For instance, as per the 2021 report of the European Union, the production of non-durable goods like clothing items increased by 2.8% in July. Also, as per the National Development and Reform Commission domestic retail sales of apparel and knitwear in China stood at 172.4 billion in 2019 and online garment sales expanded with 16.5% yearly growth. Such increase in production and consumption of clothing and apparel textile items will create more demand for PAG base oil to be used in textile machines such as spinning machine and knitting machines. Hence, this provide more growth opportunities to PAG base oil industry in textile sector.

PAG Base Oil Market Challenge

Volatility in Crude Oil Price

Synthetic oil is made from chemically modified materials such as petroleum components which are derived from crude oil. Hence, the variation in the price of crude oil due to geopolitical, weather or supply chain mishap reasons disrupt the flow of crude oil to markets. Such disruption leads to irregular production of petroleum components by manufacturers which result in indefinite production of grade V synthetic oil like PGA. For instance, as per the December 2021 report of the U.S Energy Information Administration, the crude oil price dropped to 39.17 US$ per barrel in 2020 from 56.99 US$ per barrel in 2019. Hence due to the price reduction, crude oil production fell by 8% in 2020 i.e., 11.3 million barrels per day compared to 12.2 million barrels in 2019. Such a decrease in crude oil production on account of price fluctuation will negatively impact the production of PAG base oil which can hamper the growth of PAG base oil industry.

PAG Base Oil Industry Outlook

The companies to develop a strong regional presence and strengthen their market position, continuously engage in mergers and acquisitions. PAG Base oil top 10 companies include:

  1. Exxon Mobile Corporation
  2. Denso Corporation
  3. Chevron Corporation
  4. Royal Dutch Shell Plc.
  5. Morris Lubricants
  6. Petronas Lubricant International
  7. TSI Supercool
  8. Ultrachem Inc.
  9. Idemitsu Kosan Co. Ltd
  10. Croda International Plc

Recent Developments

  • In 2021, American Industrial Partners acquired RelaDyne which is one of the leaders in North America’s lubricant distribution market extending across United States, particularly in the Mid-Atlantic region.
  • In 2021, Exxon Mobil Corporation launched Mobil SuperTM All-in-One Protection SUV Pro Synthetic Engine Oil, which consists of active ingredients that will efficient lubrication to SUV engines, enabling them to run under bad weather conditions.
  • In 2020, French lubricant company Condat SA acquired Kemno, a specialist lubricant and metalworking coolant company in Milan, hence the acquisition expands Condat market share in Italy and its fastener and machining lube capacity. 

Relevant Reports

Refrigerant Oil Market – Forecast (2022 - 2027)
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Synthetic Lubricants Market – Forecast (2022 - 2027)
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Industrial Gear Oils Market – Forecast (2022 - 2027)
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1. PAG Base Oil Market - Overview
    1.1 Definitions and Scope
2. PAG Base Oil Market - Executive summary
    2.1 Market Revenue, Market Size and Key Trends by Company
    2.2 Key Trends by type of Application
    2.3 Key Trends segmented by Geography
3. PAG Base Oil Market
    3.1 Comparative analysis
        3.1.1 Product Benchmarking - Top 10 companies
        3.1.2 Top 5 Financials Analysis
        3.1.3 Market Value split by Top 10 companies
        3.1.4 Patent Analysis - Top 10 companies
        3.1.5 Pricing Analysis
4. PAG Base Oil Market - Startup companies Scenario Premium
    4.1 Top 10 startup company Analysis by
        4.1.1 Investment
        4.1.2 Revenue
        4.1.3 Market Shares
        4.1.4 Market Size and Application Analysis
        4.1.5 Venture Capital and Funding Scenario
5. PAG Base Oil Market - Industry Market Entry Scenario Premium
    5.1 Regulatory Framework Overview
    5.2 New Business and Ease of Doing business index
    5.3 Case studies of successful ventures
    5.4 Customer Analysis - Top 10 companies
6. PAG Base Oil Market Forces
    6.1 Drivers
    6.2 Constraints
    6.3 Challenges
    6.4 Porters five force model
        6.4.1 Bargaining power of suppliers
        6.4.2 Bargaining powers of customers
        6.4.3 Threat of new entrants
        6.4.4 Rivalry among existing players
        6.4.5 Threat of substitutes
7. PAG Base Oil Market -Strategic analysis
    7.1 Value chain analysis
    7.2 Opportunities analysis
    7.3 Product life cycle
    7.4 Suppliers and distributors Market Share
8. PAG Base Oil Market - By Product Type(Market Size -$Million / $Billion)
    8.1 Market Size and Market Share Analysis
    8.2 Application Revenue and Trend Research
    8.3 Product Segment Analysis
9. PAG Base Oil Market - By Type(Market Size -$Million / $Billion)
    9.1 PAG Base Oil Market Analysis and Forecast By End Use Sector
    9.2 PAG Base Oil Market Analysis and Forecast By Sales Channel
10. PAG Base Oil - By Application Type(Market Size -$Million / $Billion)
    10.1 Segment type Size and Market Share Analysis
    10.2 Application Revenue and Trends by type of Application
    10.3 Application Segment Analysis by Type
11. PAG Base Oil- By Geography (Market Size -$Million / $Billion)
    11.1 PAG Base Oil Market - North America Segment Research
    11.2 North America Market Research (Million / $Billion)
        11.2.1 Segment type Size and Market Size Analysis
        11.2.2 Revenue and Trends
        11.2.3 Application Revenue and Trends by type of Application
        11.2.4 Company Revenue and Product Analysis
        11.2.5 North America Product type and Application Market Size
            11.2.5.1 U.S
            11.2.5.2 Canada
            11.2.5.3 Mexico
            11.2.5.4 Rest of North America
    11.3 PAG Base Oil- South America Segment Research
    11.4 South America Market Research (Market Size -$Million / $Billion)
        11.4.1 Segment type Size and Market Size Analysis
        11.4.2 Revenue and Trends
        11.4.3 Application Revenue and Trends by type of Application
        11.4.4 Company Revenue and Product Analysis
        11.4.5 South America Product type and Application Market Size
            11.4.5.1 Brazil
            11.4.5.2 Venezuela
            11.4.5.3 Argentina
            11.4.5.4 Ecuador
            11.4.5.5 Peru
            11.4.5.6 Colombia
            11.4.5.7 Costa Rica
            11.4.5.8 Rest of South America
    11.5 PAG Base Oil- Europe Segment Research
    11.6 Europe Market Research (Market Size -$Million / $Billion)
        11.6.1 Segment type Size and Market Size Analysis
        11.6.2 Revenue and Trends
        11.6.3 Application Revenue and Trends by type of Application
        11.6.4 Company Revenue and Product Analysis
        11.6.5 Europe Segment Product type and Application Market Size
            11.6.5.1 U.K
            11.6.5.2 Germany
            11.6.5.3 Italy
            11.6.5.4 France
            11.6.5.5 Netherlands
            11.6.5.6 Belgium
            11.6.5.7 Denmark
            11.6.5.8 Spain
            11.6.5.9 Rest of Europe
    11.7 PAG Base Oil - APAC Segment Research
    11.8 APAC Market Research (Market Size -$Million / $Billion)
        11.8.1 Segment type Size and Market Size Analysis
        11.8.2 Revenue and Trends
        11.8.3 Application Revenue and Trends by type of Application
        11.8.4 Company Revenue and Product Analysis
        11.8.5 APAC Segment - Product type and Application Market Size
            11.8.5.1 China
            11.8.5.2 Australia
            11.8.5.3 Japan
            11.8.5.4 South Korea
            11.8.5.5 India
            11.8.5.6 Taiwan
            11.8.5.7 Malaysia
            11.8.5.8 Hong kong
            11.8.5.9 Rest of APAC
    11.9 PAG Base Oil - Middle East Segment and Africa Segment Research
    11.10 Middle East & Africa Market Research (Market Size -$Million / $Billion)
        11.10.1 Segment type Size and Market Size Analysis
        11.10.2 Revenue and Trend Analysis
        11.10.3 Application Revenue and Trends by type of Application
        11.10.4 Company Revenue and Product Analysis
        11.10.5 Middle East Segment Product type and Application Market Size
            11.10.5.1 Israel
            11.10.5.2 Saudi Arabia
            11.10.5.3 UAE
        11.10.6 Africa Segment Analysis
            11.10.6.1 South Africa
            11.10.6.2 Rest of Middle East & Africa
12. PAG Base Oil Market - Entropy
    12.1 New product launches
    12.2 M&A s, collaborations, JVs and partnerships
13. PAG Base Oil Market - Industry / Segment Competition landscape Premium
    13.1 Market Share Analysis
        13.1.1 Market Share by Country- Top companies
        13.1.2 Market Share by Region- Top 10 companies
        13.1.3 Market Share by type of Application - Top 10 companies
        13.1.4 Market Share by type of Product / Product category- Top 10 companies
        13.1.5 Market Share at global level - Top 10 companies
        13.1.6 Best Practises for companies
14. PAG Base Oil Market - Key Company List by Country Premium
15. PAG Base Oil Market Company Analysis
    15.1 Market Share, Company Revenue, Products, M&A, Developments
    15.2 Competition Landscape
    15.3 Company 3
    15.4 Company 4 & More
*Financials would be provided on a best efforts basis for private companies
16. PAG Base Oil Market - Appendix
    16.1 Abbreviations
    16.2 Sources
17. PAG Base Oil Market - Methodology
    17.1 Research Methodology
        17.1.1 Company Expert Interviews
        17.1.2 Industry Databases
        17.1.3 Associations
        17.1.4 Company News
        17.1.5 Company Annual Reports
        17.1.6 Application Trends
        17.1.7 New Products and Product database
        17.1.8 Company Transcripts
        17.1.9 R&D Trends
        17.1.10 Key Opinion Leaders Interviews
        17.1.11 Supply and Demand Trends

LIST OF TABLES

1.Global PAG Base Oil Market Analysis and Forecast By Product Type Market 2019-2024 ($M)
2.Global PAG Base Oil Market Analysis and Forecast By End Use Sector Market 2019-2024 ($M)
3.Global PAG Base Oil Market Analysis and Forecast By Sales Channel Market 2019-2024 ($M)
4.Global PAG Base Oil Market Analysis and Forecast By Product Type Market 2019-2024 (Volume/Units)
5.Global PAG Base Oil Market Analysis and Forecast By End Use Sector Market 2019-2024 (Volume/Units)
6.Global PAG Base Oil Market Analysis and Forecast By Sales Channel Market 2019-2024 (Volume/Units)
7.North America PAG Base Oil Market Analysis and Forecast By Product Type Market 2019-2024 ($M)
8.North America PAG Base Oil Market Analysis and Forecast By End Use Sector Market 2019-2024 ($M)
9.North America PAG Base Oil Market Analysis and Forecast By Sales Channel Market 2019-2024 ($M)
10.South America PAG Base Oil Market Analysis and Forecast By Product Type Market 2019-2024 ($M)
11.South America PAG Base Oil Market Analysis and Forecast By End Use Sector Market 2019-2024 ($M)
12.South America PAG Base Oil Market Analysis and Forecast By Sales Channel Market 2019-2024 ($M)
13.Europe PAG Base Oil Market Analysis and Forecast By Product Type Market 2019-2024 ($M)
14.Europe PAG Base Oil Market Analysis and Forecast By End Use Sector Market 2019-2024 ($M)
15.Europe PAG Base Oil Market Analysis and Forecast By Sales Channel Market 2019-2024 ($M)
16.APAC PAG Base Oil Market Analysis and Forecast By Product Type Market 2019-2024 ($M)
17.APAC PAG Base Oil Market Analysis and Forecast By End Use Sector Market 2019-2024 ($M)
18.APAC PAG Base Oil Market Analysis and Forecast By Sales Channel Market 2019-2024 ($M)
19.MENA PAG Base Oil Market Analysis and Forecast By Product Type Market 2019-2024 ($M)
20.MENA PAG Base Oil Market Analysis and Forecast By End Use Sector Market 2019-2024 ($M)
21.MENA PAG Base Oil Market Analysis and Forecast By Sales Channel Market 2019-2024 ($M)

LIST OF FIGURES

1.US PAG Base Oil Market Revenue, 2019-2024 ($M)
2.Canada PAG Base Oil Market Revenue, 2019-2024 ($M)
3.Mexico PAG Base Oil Market Revenue, 2019-2024 ($M)
4.Brazil PAG Base Oil Market Revenue, 2019-2024 ($M)
5.Argentina PAG Base Oil Market Revenue, 2019-2024 ($M)
6.Peru PAG Base Oil Market Revenue, 2019-2024 ($M)
7.Colombia PAG Base Oil Market Revenue, 2019-2024 ($M)
8.Chile PAG Base Oil Market Revenue, 2019-2024 ($M)
9.Rest of South America PAG Base Oil Market Revenue, 2019-2024 ($M)
10.UK PAG Base Oil Market Revenue, 2019-2024 ($M)
11.Germany PAG Base Oil Market Revenue, 2019-2024 ($M)
12.France PAG Base Oil Market Revenue, 2019-2024 ($M)
13.Italy PAG Base Oil Market Revenue, 2019-2024 ($M)
14.Spain PAG Base Oil Market Revenue, 2019-2024 ($M)
15.Rest of Europe PAG Base Oil Market Revenue, 2019-2024 ($M)
16.China PAG Base Oil Market Revenue, 2019-2024 ($M)
17.India PAG Base Oil Market Revenue, 2019-2024 ($M)
18.Japan PAG Base Oil Market Revenue, 2019-2024 ($M)
19.South Korea PAG Base Oil Market Revenue, 2019-2024 ($M)
20.South Africa PAG Base Oil Market Revenue, 2019-2024 ($M)
21.North America PAG Base Oil By Application
22.South America PAG Base Oil By Application
23.Europe PAG Base Oil By Application
24.APAC PAG Base Oil By Application
25.MENA PAG Base Oil By Application
26.Competition Landscape, Sales /Revenue, 2015-2018 ($Mn/$Bn)