ISSUE 90 MAY 2026
THE VOICE OF THE NEW ZEALAND AUTOMOTIVE INDUSTRY
When the tap tightens upstream THE STRAIT OF HORMUZ CRISIS IS DISRUPTING MORE THAN FUEL PRICES — LUBRICANT SUPPLY AND PACKAGING COSTS ARE ALREADY MOVING, AND THE AFTERMARKET WILL FEEL IT
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ost of the coverage of the ongoing Strait of Hormuz crisis has focused on petrol prices. That’s understandable — pump prices are visible, immediate, and politically charged. But for the automotive aftermarket, the more consequential story is playing out further upstream, in the base oil and lubricant supply chains that keep workshops stocked and vehicles serviced. The strait is the world’s most critical energy chokepoint. According to the US Energy Information Administration, around 20 million barrels per day of crude oil and petroleum products were transiting Hormuz before the current crisis — roughly 20% of global oil consumption. Critically for this region, around 84% of that crude was destined for Asian markets, with China, India, Japan, and South Korea the dominant recipients. These are
the same countries that house the refineries producing the base oils blended into the motor oils, transmission fluids, and gear oils used throughout the New Zealand aftermarket. When crude stops moving through the strait, the downstream effects ripple quickly and widely.
BASE OILS, ADDITIVES, AND PACKAGING — THE TRIPLE SQUEEZE Lubricant pricing is not simply a function of crude oil costs at the pump. Finished motor oil is a blended product, combining base oils — themselves refined from crude — with performance additive packages that are also petroleum-derived. When crude supply tightens, both components are affected simultaneously. The disruption has hit Group III base oils
particularly hard. The Middle East is a major global source of high-quality Group III stock, with significant production capacity at facilities including Shell’s Pearl GTL plant in Qatar. Reported impacts on those facilities, combined with near-total restrictions on tanker traffic through the strait, have created acute tightness in Group III supply globally. Industry reports indicate Asian markets are now experiencing record-high base oil prices, with some blenders in the United States reporting cumulative price increases approaching US$2.00 per gallon above pre-conflict levels — and similar pressure is being felt across Asia-Pacific supply chains. Suppliers into New Zealand are reporting price increases in the range of 30% to 50%, with some orders being rationed as blenders and distributors work through limited available stock.
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