SCL Customers Can Lock in Current Pricing by Ordering Now Through October 25

For the second time in 2020, major oil suppliers have announced hikes of up to 10% on finished lubricants effective October 26, breaking the tradition of increasing prices only once annually.

An increase in the cost of raw materials used in the production of pails also forced additional increases of up to $.12/pail, further pushing up the total potential cost increase for lubricants. With pail cost increases occurring monthly the total increase since July 2020 is now $.45/pail.

In January 2020, Chevron, Phillips 66, Mobile, Shell, Total and others announced increases up to 12% on finished lubricants, citing “increasing costs of raw materials impacting the manufacturing of (our) products.” This price increase was rescinded due to Covid 19 impact on lubricant raw materials and demand.

Since then, there have been two surges in the price of base oils – one announced June 22 and another on September 4, each between $0.15-$0.25, which organically led to increases from $0.40-$0.50 on finished lubricants, said SCL Vice President of Sales Dan Dziwanowski.

“This year has been a volatile year, everyone knows that, but even with two price increases on finished lubricants, our prices are still more stable than fuel,” Dziwanowski said. “The market leveled off in the high $30/barrel range in June, then Hurricane Sally in October adversely impacted oil operations in the Gulf of Mexico, driving up the per barrel price again. Those are conditions that are simply beyond our control, but they are conditions we will help our customers navigate nonetheless.”

According to a statement by Shell, “crude oil and VGO, the primary feedstock for base oils has risen 16% to 18% since the last round of price increases in late May/early June compressing margins.” And that’s on top of hiccups in transportation that arose from COVID-19, and a steady rise in packaging and raw materials.

DEF raw materials and packaging have also been hit in the past three months, not to mention “ocean freight costs have increased five-fold,” Dziwanowski said. As a result, DEF increases have also occurred totaling $0.08 gallon. SCL will pass along that increase as well beginning Oct. 26.

Current prices on all finished lubricants will remain in effect through October 23 for Shell and November 1 for Mobil. With any increase, customers are urged to fill their tanks before new prices take effect.

“Price increases are a result of a number of different factors related to the global economy – from political unrest to natural disasters like hurricanes, all of which have had a presence this year,” Dziwanowski said. “Regardless of what’s occurring in the world and in our industry, we know we have the expertise to help our customers minimize the impact of this.”

In response to the following announcements, SCL will raise prices on October 23, 2020:

• Chevron Price Communicaton – October 2020
  
  • Chevron Pricing Support Deck – September 2020
• Shell Price Increase Announcement – October 2020
  • Shell Market Conditions Adjustment – October 2020
    
• Mobil Price Increase Announcement – November 2020
  
• P66 Price Increase Announcement – October 2020
• Total Price Increase Announcement – November 2020
• Valvoline Price Change Announcement – November 20
• Pail Price Increase – July 2020
• Pail Price Increase – August 2020
• Pail Price Increase – September 2020

“We recognize and respect that this change comes in the midst of a challenging time for everyone,” said SCL General Manager Travis Becktel. “As we always have, our goal will be to help our customers offset this increase, either on the front end by exploring different products that help save on fuel economy or on the back end with services like oil analysis that can save long term.”

Because SCL is bound by historical monthly volume for orders, all customers are encouraged to place requests as soon as possible.

Contact an SCL Consultant today 

In a wide range of automotive, industrial and commercial sectors, SCL remains steadfast on its commitment to product and industry knowledge, performance satisfaction and superior logistics. We protect and optimize the machines that keep our country moving. For more information on how we help can help with services including bulk purchasing or managing inventory, contact an SCL expert today.