America’s next supply crunch: The motor oil change you may not be able to get
(NMA) — The war with Iran has already sent gas prices soaring and disrupted global food production. Now, a new crisis is bearing down on American drivers — and it’s one that arrives every 5,000 miles.
The humble oil change, a routine ritual for millions of car owners, is about to become more expensive and potentially much harder to come by.
Wholesale motor oil prices are rising at an unprecedented pace, and industry executives are warning of imminent shortages of the most popular grades of oil used in newer vehicles. The culprit: damage to key facilities in the Middle East and the shutdown of the Strait of Hormuz, a narrow waterway that has become a chokehold on a tiny but critical corner of the oil market.
“We’re looking at shortages — I have no doubt in my mind,” Holly Alfano, CEO of the Independent Lubricant Manufacturers Association (ILMA), told CNN. “It’s a big mess — and it’s not going to be resolved quickly. It could take a year or so before we see any real relief.”
The problem centers on so-called Group III base oils, a highly refined product used to make the low-viscosity synthetic motor oils that have become standard in most modern cars. Grades like 0W-16, 0W-8 and especially 0W-20 — which accounts for roughly one-third of all passenger car motor oil demand — are facing the most severe strain.
According to ILMA, nearly half (44%) of the Group III base oil used in the United States comes from just three Persian Gulf producers. Those supplies have been cut off since late February, when the Strait of Hormuz closed following the outbreak of war.
To make matters worse, the world’s largest gas-to-liquids plant — Pearl GTL in Qatar, a leading supplier of Group III base oils — was attacked and seriously damaged. Shell, which operates the facility, has said repairs could take about a year.
“The U.S. is expected to run out of Mideast Gulf-origin Group III by June,” ILMA warned in a bulletin last week.
Price hikes ‘unheard of’ in decades
Tom Glenn, president of Petroleum Trends International and publisher of industry publication JobbersWorld, has been tracking the dizzying rise in motor oil prices since the war began.
“Three rounds of price increases over two and a half months is unheard of. And the magnitude is stunning,” Glenn told CNN. “I’ve been in this business since 1979, and I’ve never seen anything quite like this.”
“I can’t think of a period where you’ve had shocks like these,” said Eric Winograd, an alumnus of the New York Federal Reserve Bank who is now the chief economist at asset manager AllianceBernstein. “I’m not saying that these are the biggest in magnitude, but to have this many sequential events is extremely unusual.”
In a normal year, motor oil producers might raise prices for distributors by 70 to 80 cents a gallon. Already this year, Glenn said, some producers have hiked prices by $5 or more a gallon for bulk buyers.
Spot prices for affected base oils have nearly tripled to all-time highs, while retail motor oil prices are up roughly 35% and still climbing, according to industry analysts.
Normally, the U.S. would turn to South Korea to fill the gap. But Asian refiners rely on the Strait of Hormuz for much of their crude, and those that do have access are focused on producing jet fuel and diesel — products that command historically high profit margins.
The industry could also pivot to lower-grade Group II base oils, but those are also being diverted to diesel production. “The Group II safety valve is effectively closed,” ILMA said.
The American Petroleum Institute has invoked emergency provisional licensing to give manufacturers flexibility to use alternative base oil supplies. But each waiver requires separate technical documentation to ensure performance standards aren’t compromised. Automakers including Toyota and Nissan have issued internal memos warning of the shortages and offering substitution guidelines.
Despite the grim outlook, some experts believe the industry will find a way to keep cars on the road — even if the solutions are imperfect.
“America is not going to stop driving cars. Trucks are not going to stop delivering goods. We’re not going to come to a grinding halt,” Glenn said.
Possible stopgaps include automakers temporarily authorizing slightly higher viscosity oils that require less Group III base oil, or extending recommended oil change intervals. The trade-off, however, could include long-term engine damage.
“It will be ugly to see how this is done,” Glenn said. “But I think they will find a solution. Quitting is not an option. We’ll find a way to keep America moving.”
What drivers should expect
For now, major oil change chains like Valvoline say they have adequate supply to serve customers. But smaller shops are already receiving warnings from suppliers that availability will become a problem in June, according to Michael Chung of the Auto Care Association.
Patrick De Haan, head of petroleum analysis at GasBuddy, pointed to an AutoZone memo warning that the industry is facing the largest supply shortage of lubricating fluids in modern American history, with supplies falling roughly 40%.
“Your next oil change may be more of a headache,” De Haan said. “Expect to pay more. It’s not that the dealer just wants to mark it up; it’s a supply-and-availability issue, and that may not fix itself until well into 2027.”
The White House said it anticipated short-term disruptions from what it calls “Operation Epic Fury” and has taken steps including waiving the Jones Act. But Alfano, the ILMA CEO, noted that while Energy Department officials are “turning over every stone,” there is no easy answer.
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