Why hasn't engine oil prices gone up too?

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Bill Plock

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Just curious if anyone has thoughts on why engine oil prices haven't increased along with fuel prices. ?? Seems like the last major jump in engine oil prices was after Hurricane Katrina. (maybe I should increase my oil stash
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I imagine there's a couple of reasons. Fuel is subject to speculation. It's a more dynamic product. Inventories are more easily valued and priced. There is no substantial storage capacity for it.

Fuel has an infinite demand based on price. 100% of it that is produced is sold in a relatively short time. Motor oil is more diverse in the offerings and has no such mandated repurchase continuum. Although you have to change your oil, it's not like your car stops running at a given mileage without an oil change.

That's just a guess
 
Originally Posted By: Drew99GT
What? Oil prices have gone through the roof. Conventional is approaching $4/quart.

Synthetics are what, around $6.99/quart?


I think he's saying "in proportion" in a dynamic way. You don't see anyone repricing the stuff on the shelf, and we do still see bargains.
 
I agree with Gary. Managers of pension portfolios can't hedge against a falling USDollar valuation by buying a few million quarts of Quaker State 5w30...however, they can prop up their returns by speculating on oil futures.
 
Originally Posted By: Gary Allan
Originally Posted By: Drew99GT
What? Oil prices have gone through the roof. Conventional is approaching $4/quart.

Synthetics are what, around $6.99/quart?


I think he's saying "in proportion" in a dynamic way. You don't see anyone repricing the stuff on the shelf, and we do still see bargains.


Yes, exactly ... also, on percentage basis motor oil prices have increased but not nearly as much as fuel prices .. If crude prices remain high it seems engine oil prices will continue to rise .. may be time to stock up ??
 
Percentage wise, I'd say it has gone up roughly the same as gasoline. Back a few years ago when motor oil was about $2/quart, gas was in the $2 range.
 
Originally Posted By: Titan
I agree with Gary. Managers of pension portfolios can't hedge against a falling USDollar valuation by buying a few million quarts of Quaker State 5w30...however, they can prop up their returns by speculating on oil futures.

And we're paying dearly at the pump for that today. There needs to be a limit on it.
 
wholesale PCMO had doubled from about $3./00 gal to currently $6.00 gallon in a year. Quarts of oil are low in that they are 1 a loss leader to get you inoto store and 2 there is perhaps a years worth of oil in the supply chain at old prices.

But I can tell you base stock have doubled and aditives are up 25-30% aswell as transportaion charges and fuel sur charges to bulk deliverys no end in sight base stocks up 50 cents last week.
bruce
 
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Originally Posted By: Drew99GT
Percentage wise, I'd say it has gone up roughly the same as gasoline. Back a few years ago when motor oil was about $2/quart, gas was in the $2 range.


I've just been going on perception and haven't done the research and analysis. However, for the last year I've been buying 5 gal jugs of Castrol 5w30 75k high millage oil for my daughters Saturn for about $12 and during that time gas prices have increased dramatically. In 04-05 I was buying quarts of M1 5w40 for my Duramax at about $4/qt & IIRC, diesel fuel was in the $2/gal range. M1 5w40 is now in the $6/qt range and diesel fuel is $5/gal.
shocked2.gif


Here's an interesting price history plot from http://zfacts.com/p/35.html ..

zFacts-Gasoline-Price.png


Per Bruce's post sounds like I better stock up before retail motor oil prices go any higher ...
 
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Originally Posted By: Bill Plock
Originally Posted By: Drew99GT
Percentage wise, I'd say it has gone up roughly the same as gasoline. Back a few years ago when motor oil was about $2/quart, gas was in the $2 range.


I've just been going on perception and haven't done the research and analysis. However, for the last year I've been buying 5 gal jugs of Castrol 5w30 75k high millage oil for my daughters Saturn for about $12 and during that time gas prices have increased dramatically. In 04-05 I was buying quarts of M1 5w40 for my Duramax at about $4/qt & IIRC, diesel fuel was in the $2/gal range. M1 5w40 is now in the $6/qt range and diesel fuel is $5/gal.
shocked2.gif


Here's an interesting price history plot from http://zfacts.com/p/35.html ..

zFacts-Gasoline-Price.png


Per Bruce's post sounds like I better stock up before retail motor oil prices go any higher ...


I was just kind of basing my observation on standard retail prices at chain auto parts stores. aka, never buy oil at one for full retail!
 
My understanding is that during the crude oil refining process, X amount gets turned into gasoline, Y amount gets turned into motor oil, Z amount gets turned into asphalt, etc. That Y amount can't be (easily/cheaply) converted into gasoline, which is what everyone really wants, so as more and more gasoline is refined, more and more semi-unwanted motor oil is made too. That keeps motor oil prices from going up too much.
 
Hmmm ... might have to go to Wally -World and stock up on Pennzoil 5W-20 at $10 for a 5-quart jug. I only have two jugs in my stash as I write this ...
 
Originally Posted By: Drew99GT
What? Oil prices have gone through the roof. Conventional is approaching $4/quart.

Synthetics are what, around $6.99/quart?


What rock do you shop under???
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""and more gasoline is refined, more and more semi-unwanted motor oil is made too""

NO more diesel is made NOT base oils
 
Do you ever get "backed up", Bruce? ..or ..do you get "offers" for surplus base stocks that are backing up in the system??

I don't know if I'm saying this right.

One would assume that all the majors sequester so much refining capacity for anticipated needs for lubricants production with blending and packaging being the final process. The process is surely longer from distilling to bottling than it is distilling to fuel pumping ..or so I would imagine. Fuel is also not competitive in selling price, while lubricants are.

I would imagine any retail discounting (as you eluded to) would be where the supply train is backing up and through put will be hindered to a greater expense than the losses on the retail product.
 
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