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He said that at retail, some big auto parts retailers may drop the engine oil prices per quart or five quart jug a little bit in response to oil majors cutting prices. “But I think part of the supply chain will probably try to get as much financial gain out of this as they can,” he noted. “I would suspect everyone is trying to get as much financial benefit out of it as they can. The majors are trying to hold back as much as they can, before they have to start passing it along. You can argue customers of distributors will say the same thing.”
The lubricant price cuts are unlikely to have much impact at the consumer end user level, Morvey said. So if a regular oil change costs $24.95 now for a consumer passenger vehicle, it’s unlikely to drop substantially any time soon. “I think we’ll be paying $24.95 for a long time,” he added.
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Additionally, the impact of lower priced base oil on finished lubricant prices will be less significant for specialty or premium products, and synthetics in particular,” he said. “Market prices for additives and synthetic base fluids (excluding Group III oil) obviously do not have the same sensitivity to falling crude oil prices as Group I to III oils do, although there is some carryover.”
We've talked quite a bit about reasons for or against pricing drops, and it looks like the majors are going down - but only a little bit. What this means is that the regular list price on most products will likely remain close to the same.
For us Canadians, the drop in the CAD has followed the drop in oil prices, which means even companies that make their oil here has had all their other ingredients (like additives etc) raise in price if they were importing them from the USA. For this reason I don't expect we will see any change in the consumer price of oil up here. Maybe some more frequent sales on some brands, but I don't foresee a major shift in price.
Quote:
He said that at retail, some big auto parts retailers may drop the engine oil prices per quart or five quart jug a little bit in response to oil majors cutting prices. “But I think part of the supply chain will probably try to get as much financial gain out of this as they can,” he noted. “I would suspect everyone is trying to get as much financial benefit out of it as they can. The majors are trying to hold back as much as they can, before they have to start passing it along. You can argue customers of distributors will say the same thing.”
The lubricant price cuts are unlikely to have much impact at the consumer end user level, Morvey said. So if a regular oil change costs $24.95 now for a consumer passenger vehicle, it’s unlikely to drop substantially any time soon. “I think we’ll be paying $24.95 for a long time,” he added.
Quote:
Additionally, the impact of lower priced base oil on finished lubricant prices will be less significant for specialty or premium products, and synthetics in particular,” he said. “Market prices for additives and synthetic base fluids (excluding Group III oil) obviously do not have the same sensitivity to falling crude oil prices as Group I to III oils do, although there is some carryover.”
We've talked quite a bit about reasons for or against pricing drops, and it looks like the majors are going down - but only a little bit. What this means is that the regular list price on most products will likely remain close to the same.
For us Canadians, the drop in the CAD has followed the drop in oil prices, which means even companies that make their oil here has had all their other ingredients (like additives etc) raise in price if they were importing them from the USA. For this reason I don't expect we will see any change in the consumer price of oil up here. Maybe some more frequent sales on some brands, but I don't foresee a major shift in price.
