Re-Refined Base Oil Market: Fueling the Sustainability Revolution

According to Inkwood Research, the global re-refined base oil market is expected to reach $xx million by 2032, growing at a CAGR of 6.05% during the forecast period 2024-2032. In an era where climate change concerns are reaching a crescendo, the need for sustainable practices has become more apparent than ever. The oil industry, a major contributor to environmental challenges, is witnessing a positive transformation with the emergence of re-refined base oils (RRBOs). 

Re-refined base oil is a lubricating oil produced through a recycling process that involves collecting and pre-treating used oil from various sources. The oil undergoes distillation to separate its components, removing impurities and is then subjected to hydrotreating for further purification by treating it with hydrogen. 

Additives are blended in to enhance its performance properties, such as antioxidants and viscosity modifiers. Rigorous quality control measures ensure the re-refined base oil meets industry standards.

Re-Refined Base Oil Market - Inkwood Research

Re-Refined Base Oil Market | The Evolution of Re-Refining

The roots of re-refining date back to 1921 in Germany, marking the inception of a process that has evolved significantly over the years. From early techniques involving simple distillation over clay and sulfuric acid, the industry has progressed to sophisticated methods like hydrogenation and solvent extraction. 

The pinnacle of re-refining technology today is hydrotreating, capable of producing premium quality base oils meeting API group II specifications.

Quality Concerns in the Re-Refined Base Oil Market Addressed –

Despite its potential, re-refined base oils faced initial skepticism due to observable color differences and occasional odors. However, the industry has undergone transformative changes. 

Improved collection practices, enhanced infrastructure, better feedstocks, and advanced re-refining technologies have collectively elevated the quality of re-refined base oils. Independent testing has demonstrated that the performance and quality of re-refined oil can often surpass that of virgin base oils.

Re-refined base oils are categorized into three groups – Group I, Group II, and Group III. Each group represents a different level of refining and performance characteristics:

Group I: Traditional solvent-refined base oils that are commonly used in less demanding applications. Although considered a declining market, Group I base oils still find applications in certain industrial and automotive lubricants.

Group II: These base oils undergo a more advanced refining process, offering improved performance and stability compared to Group I. Group II base oils are widely used in a range of applications, including engine oils, hydraulic fluids, and industrial lubricants.

Group III: Considered fully synthetic, Group III base oils are subjected to even more advanced refining processes, resulting in higher purity and performance. They are often used in high-performance lubricants, meeting the stringent requirements of modern engines and machinery. 

Re-Refined Base Oil | Process & Benefits:

Re-refiners employ a series of processes to remove contaminants, water, spent additives, and original remaining additives from used oil. This reclamation process yields approximately 75% to 80% of the original base stock, which is then further refined and blended to produce finished products. The benefits of re-refining extend beyond waste reduction.

According to the American Petroleum Institute (API), re-refining consumes 50% less energy than refining crude oil for base oil production. This translates into reduced CO2 emissions, fine dust emissions, and acidifying substances, making re-refined base oils an environmentally friendly alternative.

Furthermore, a study by GEIR (UEIL) reveals that RRBOs have a significantly lower carbon footprint compared to virgin-based oil production processes, reducing CO2 emissions by up to 71%.

Global Adoption & Initiatives in the Re-Refined Base Oil Market

Approximately 40% of used oil in the United States is captured and recycled, with nearly 14% being re-refined. The industry is gradually recognizing the potential of re-refined base oils. Leading the charge is Neste (Finland), with a new Neste ReNew™ lubricant product family in various European countries.

These lubricants are produced with renewable or re-refined base oils and high-quality additives, providing customers with an opportunity to reduce their dependence on crude oil-based products and contribute to a more sustainable future.

Rising Prominence of Re-Refined Lubricants in a Sustainable Market: 

Re-refined lubricants present various benefits, such as avoiding direct competition for feedstocks used in food production and addressing disposal challenges associated with used lubricants. Additionally, the evolving quality of re-refined products opens up possibilities for them to serve as a more environmentally friendly substitute for high-carbon footprint PAO. 

The market for re-refined base stocks is on the brink of growth, considering the annual global production of 40 million tons of lubricating oil, with 22 million tons available as feedstock after accounting for combustion, consumption, and spills.

Currently, 68% of this oil is collected globally, and 40% can be re-refined, resulting in the annual production of around 4 million tons of re-refined base stocks. A capacity increase to 5 million tons per year by 2025 is foreseen, with Asia-Pacific and North America emerging as key suppliers.

In Conclusion – 

The re-refined base oil market stands at a critical juncture, aligning with global efforts to combat climate change and promote sustainability. As technological advancements continue and awareness grows, re-refined base oils are poised to become a mainstream choice. 

With benefits ranging from waste reduction to energy efficiency and lower emissions, the re-refined base oil market offers a compelling solution for a more sustainable and environmentally conscious future. As industries and consumers alike prioritize eco-friendly alternatives, re-refined base oils are positioned to play a pivotal role in the ongoing transition toward a greener, more sustainable world.

By Aishwarya Mishra

FAQ

The construction, automotive, manufacturing, and packaging industries are the major consumers of re-refined base oil.

Re-refined base oil is produced via various processes like acid and clay treatment, propane extraction, flash distillation, and de-metallization & hydro-processing.