Total demand of Pakistan is approximately 400 million litres (400,000 mt) per annum out of which about 50 percent is produced locally by registered reclamation and blending plants with locally available Lube Base Oils (LBOs) from National Refinery Limited (NRL). 11 percent of the LBOs are imported in raw form which is further converted into finished products while 11 percent finished lubricants are being imported to meet local demand. The shortfall is met through Iranian smuggled lubricating oils, spurious and substandard oils made by illegal reclaimers in the Country particularly in Karachi. The illegal inflow of lubricants not only damage the legal reclaimers and blenders but also cause heavy losses to the transporters in term of reducing engines' life.
Due to network of petrol pumps spread across the Country, oil marketing companies (OMCs) have an edge over their competitors and other manufacturers for increased share in the market to sale and distribute lubricating oils in addition to various petroleum products. However, there are several other factors which are responsible for market share of different lubricating brands. These factors include pricing, quality, marketing and customers' opinion through different channels including word of mouth.
PSO caters all kinds of lubricants customers including automotive and industrial consumers having latest lubricants manufacturing terminal in Karachi. PSO has introduced Lubricant security features which is first of its type in Pakistan. Consumers can authenticate the product genuinity via SMS through the security code available on lubricant's pack. Pakistan State Oil (PSO) being the state owned Company have the largest petrol pumps' network in the Country is the largest seller of diesel and petrol as well but as far as lubricants are concerned, PSO stands at number two, with market share of about 14 percent. The industrial oils produced by PSO include gas engine oils, marine oils, turbine oils, compressor oils and many more.
The largest shareholder in the lubricant market is Shell Pakistan, which has captured 21 percent lubricants' market in the Country. Shell is the number one global lubricant supplier, delivering market-leading lubricants to consumers in over 100 countries. Shell Pakistan has established itself as a valued multinational company of Pakistan. Shell offers different kinds of lubricating oils and the top and latest brands offered by Company includes Helix Car Engine Oils, Advance Motorcycle Engine Oils, Rimula Truck & Heavy duty Engine Oils, Helix Ultra (Synthetic Motor Oils) and Helix Ultra Pure Plus (made from natural gas). Shell also produces and sells industrial lubricants to different sectors including Power, Aviation, Automotive, etc.
Mal Pakistan Limited (formerly Mobil Askari Lubricants Ltd) produces and supplies both automotive and industrial lubricant oils with different brand names of Mobil Delvac, Mobil Delvac MX, Mobil Delvac Super, for commercial motors, Mobil 1, Mobil Special and Mobil Super 1000 for passenger motors while Mobil 1 Racing is for Motorcycles. Wide range of lubricants for industrial sector is also offered by the Company. Mal Pakistan entered into Pakistani market in 1997 and is responsible for approximately 11 percent share in the lubricants market of Pakistan.
Castrol has representation in 74 countries worldwide with delivery network in 120 countries. In Pakistan Castrol sells automotive, aviation and industrial lubricants with approximately 1 percent market share in the Country.
High Tech Lubricants Limited serves the Pakistan's lubricant market with brand name of Zic through more than 20 thousand retail outlets and representation in all provinces including AJK. It manufactures different lubricating oil including Gasoline & Hybrid, Diesel oils, Motorbike and Under Hood. The Zic's share in local market is approximately 5 percent however other imported brands contribute up to 11 percent in the lubricants' market of Pakistan.
Local brands which contribute to 15 percent of lubricants' market of Pakistan include Ken S-4 Advance, Kenwin GX-Super, Kenex 500, Ken GL-1, Ken-7, Ken Gold, etc., by KenLubes, numerous Black Tiger lubricating oils, various lubricants by Master and variety of Total-Parco brands. The remaining six percent is met through smuggled oils from Iran and illegal reclaimers in the Country.
For the growth of legal Lubricants business in Pakistan it is important to resolve the major problems faced by this sector including inflow of smuggled Lube base oils and finished lubricants, high rate of custom duty on imports of Lube Base Oils, eradication of commercial operators in unregulated sector, illegal reclamation of Used Lubricating Oil and high cost of doing business.
Policies, rules and regulations for this sector of economy should be simplified and reviewed in accordance to the recommendations being forwarded by the Lubricants' manufacturers, so that this sector may actively participate in the economic growth of the Country.