Episode 16: The future of the lubricants industry – A perspective from Asia

In today’s environment, it is no longer politically correct to espouse the importance of the internal combustion engine in light of the climate change movement.

Episode 16 of F+L Webcast with Eugene Tan takes a different perspective on the role of lubricants in the context of climate change.

Tan, senior advisor of GXS Partners, a consulting company focused on strategic advisory and business operational solutions that work in Asia, has over 30 years of Industry experience before retiring as BP’s director of Global Supply Chain for Asia & Pacific, leading the development of bulk and packed supply chain strategy and execution for the Asia and Pacific regions, including the Middle East.

Scope 3 is a particularly challenging measure, because it measures use and the consequence of use, says Tan. Scope 3 contributes to the highest percentage of an oil companies’ carbon footprint, some would argue as much as 90%. Because the purpose of lubricants is to reduce friction and improve the performance of engines, therefore lubricants in itself actually reduces carbon emissions, he argues. 

There will be challenges with regards to packaging and how spent lubricants are managed, he admitted. “But we believe this can be handled.” 

In this episode, Tan explains why multinational corporations (MNCs) should pivot their lubricant businesses’ focus to Asia.

In addition, he says “we believe that independent lubricant companies and Asian national oil companies would have a higher likelihood of accepting that the internal combustion engine supports the development of mobility in Asia at the lowest environmental impact,” due to the fact that the use of coal in power generation is more polluting.

In this deep-dive into the future of the lubricants industry in Asia, Tan expects the internal combustion engine in transport is going to be around much longer than most people have projected. As we drive for greater efficiencies, the quality of lubricants in Asia is going to improve dramatically, he says. 

“It will be a quality game. It will be a value game. Asia will be the center of the lubricants industry globally.”