Abstract: A method for pretreating and re-refining used oil that requires only moderate heat and only one re-refining step. The pretreatment involves mixing the used oil with a basic solution and optionally a phase transfer catalyst. The phase transfer catalyst aids the chemical reaction which allows removal of impurities in used oil. The basic solution preferably includes more than one base. The used oil, basic solution and phase transfer catalyst are mixed under low heat. The pretreated oil is then mixed with liquid propane in a non-turbulent manner, such as by use of a globe valve or orbit valve. The mixture of used oil and liquid propane are then placed into an extraction vessel and impurities are allowed to settle out of the oil and propane mixture. Heavy fraction may be removed from the extraction vessel. Preferably, a second vessel called a settling vessel will be used to cause further settling of impurities out of the used oil. Light fraction is produced which may be re-refined to produce base oil.