Global Vacuum Gas Oil Market Size By Grade Type, By Application, By End-Use Industry, By Geographic Scope And Forecast
Published on: 2024-08-08 | No of Pages : 320 | Industry : latest updates trending Report
Publisher : MIR | Format : PDF&Excel
Global Vacuum Gas Oil Market Size By Grade Type, By Application, By End-Use Industry, By Geographic Scope And Forecast
Vacuum Gas Oil Market Size And Forecast
Vacuum Gas Oil Market size was valued at USD 359.38 Billion in 2023 and is projected to reach USD 473.54 Billion by 2030, growing at a CAGR of 5.70% during the forecast period 2024-2030.
The Vacuum Gas Oil (VGO) Market refers to the segment of the petroleum industry dedicated to the production, refining, and distribution of vacuum gas oil. VGO is a crucial intermediate product obtained from the vacuum distillation process in crude oil refining. It serves as a feedstock for various downstream processes such as fluid catalytic cracking (FCC), hydrocracking, and coking, which produce valuable products like gasoline, diesel, and jet fuel. The market encompasses the production, trade, and consumption of VGO across different regions globally.
Global Vacuum Gas Oil Market Drivers
The market drivers for the Vacuum Gas Oil Market can be influenced by various factors. These may include
- Crude Oil Price Fluctuations The price of crude oil has a significant impact on the VGO market. Oil price volatility can affect the profitability and refining margins, which makes market participants hesitant to invest in the infrastructure needed for VGO production or processing.
- Environmental Regulations Tight environmental rules pertaining to petroleum product extraction, refining, and transportation, including VGO, make market expansion difficult. Requirements for waste disposal, emissions requirements, and carbon reduction targets may need large investments in infrastructure and technology changes.
- Transition to Renewable Energy The market for conventional petroleum products like VGO is long-term threatened by the world’s shift to renewable energy sources including solar, wind, and biofuels. Government attempts to encourage the use of renewable energy sources and reduce carbon emissions may hinder VGO’s market prospects in the future.
- Refining Industry Overcapacity In certain areas, production exceeds demand, posing an overcapacity problem for the industry. This oversupply situation might impede market growth and investment opportunities by putting pricing pressure on VGO producers and refiners and reducing their profits.
- Competition from Alternative Feedstocks For usage in the processing of petroleum and petrochemicals, VGO faces competition from alternative feedstocks including shale oil and natural gas liquids (NGLs). The market potential for VGO in specific applications may be restricted by technological improvements and the cost-competitiveness of alternative feedstocks.
- Economic Uncertainty The global energy demand and investment sentiment can be impacted by economic downturns, geopolitical tensions, and trade disputes, all of which can have an effect on the VGO market. In VGO-related initiatives, uncertainty about the state of the economy may cause cautious expenditure and a delay in investment decisions.
- Energy Transition Policies The expansion of the VGO market may be hampered by government measures to promote energy transition and lessen dependency on fossil fuels. Investments in low-carbon and renewable energy-related projects may be redirected by mandates, subsidies, and incentives.
- Technological Disruptions The conventional petroleum refining business, which includes the manufacture of VGO, is facing disruptive pressures from emerging technologies including electric vehicles, hydrogen fuel cells, and advanced biofuels. Technological developments in energy utilization, storage, and transportation may change the energy markets and hurt VGO’s long-term prospects.
Global Vacuum Gas Oil Market Restraints
Several factors can act as restraints or challenges for the Vacuum Gas Oil Market. These may include
- Growing Need for Refined Petroleum Products Vacuum gas oil is an essential feedstock in the procedures used to refine petroleum because of the rising demand for gasoline, diesel, and other refined petroleum products on a worldwide scale. Growing fuel consumption is a result of fast industrialization, urbanization, and the growth of transportation infrastructure, which increases demand for VGO.
- Growth in Refining Capacity The continuous growth in petroleum refining capacity, especially in developing nations, increases the need for VGO. By increasing demand for VGO as a feedstock for downstream processing, investments in new refining facilities, improvements to existing refineries, and the commissioning of sophisticated refining units propel market growth.
- Technological Developments in Refining Processes The efficiency and adaptability of using VGO is improved by technological developments in refining processes like hydrocracking and fluid catalytic cracking (FCC). Advancements in catalyst creation, process streamlining, and apparatus layout empower refiners to optimize the transformation of volatile petroleum oil (VGO) into valuable products, consequently stimulating market demand.
- Shift Toward Clean Fuels The demand for cleaner-burning fuels is driven by regulatory mandates intended to reduce car emissions and improve air quality. The production of low-sulfur gasoline and diesel fuels that abide by strict environmental rules depends on vacuum gas oil, which propels market expansion in areas where cleaner fuel requirements are being implemented.
- Demand for Petrochemical Feedstock The need for VGO as a feedstock in petrochemical production processes is driven by the rising demand for petrochemical products, such as chemicals, polymers, and plastics. Steam crackers and other petrochemical operations use streams obtained from vegetable oil (VGO) as feedstock, which helps meet market demand in the face of rising petrochemical use.
- Increasing Energy Consumption in Emerging Economies The need for petrochemicals and fuels derived from vegetable and grain oil (VGO) is fueled by the population increase, urbanization, and industrialization of emerging economies. The demand for VGO is anticipated to increase in tandem with developing nations’ investments in economic expansion and infrastructure development, propelling the market’s growth.
- Transition to Hydroprocessing Technologies The need for VGO as a feedstock rises with the use of hydroprocessing technologies like hydrocracking and hydrotreating. The market demand for this adaptable feedstock is increased by refiners’ ability to manufacture cleaner fuels and higher-value products from VGO thanks to these technologies.
- Strategic Petroleum Reserves and Security To guarantee energy security and supply stability, governments and industry players keep strategic petroleum reserves. During times of geopolitical unpredictability, vacuum gas oil supports market demand by contributing to strategic reserves and security measures and playing a critical role in refining operations.
Global Vacuum Gas Oil Market Segmentation Analysis
The Global Vacuum Gas Oil Market is Segmented on the basis of Grade Type, Application, End-Use Industry, and Geography.
Vacuum Gas Oil Market, By Grade Type
- Low-Sulfur Vacuum Gas Oil (LS-VGO) This grade of vacuum gas oil contains lower sulfur content, making it suitable for refining into cleaner fuels such as diesel and gasoline with reduced sulfur emissions.
- High-Sulfur Vacuum Gas Oil (HS-VGO) HS-VGO typically contains higher sulfur content and may require additional processing for sulfur removal before being used as feedstock for fuel production.
Vacuum Gas Oil Market, By Application
- Refining Vacuum gas oil serves as a crucial feedstock for refineries, where it undergoes further processing in fluid catalytic cracking (FCC) units, hydrocrackers, and other conversion processes to produce various petroleum products, including gasoline, diesel, and jet fuel.
- Petrochemicals Vacuum gas oil can also be utilized as a feedstock for petrochemical processes, including steam cracking, to produce olefins such as ethylene and propylene, which are used in the production of plastics, synthetic fibers, and other chemical products.
Vacuum Gas Oil Market, By End-Use Industry
- Petroleum Refining
- Petrochemicals
- Others
Vacuum Gas Oil Market, By Geography
- North AmericaMarket conditions and demand in the United States, Canada, and Mexico.
- EuropeAnalysis of the VACUUM GAS OIL MARKET in European countries.
- Asia-PacificFocusing on countries like China, India, Japan, South Korea, and others.
- Middle East and AfricaExamining market dynamics in the Middle East and African regions.
- Latin AmericaCovering market trends and developments in countries across Latin America.
Key Players
The major players in the Vacuum Gas Oil Market are
- Shell plc
- Chevron Corporation
- Exxon Mobil Corporation
- China National Petroleum Corporation
- BP PLC
- Lukoil (Russia)
- TAIF-NK (Russia)
- KazMunayGas (Kazakhstan)
- Axeon Specialty Products (US)
- Neste (Finland)
- Vertex Refining (US)
Report Scope
REPORT ATTRIBUTES | DETAILS |
---|---|
STUDY PERIOD | 2020-2030 |
BASE YEAR | 2023 |
FORECAST PERIOD | 2024-2030 |
HISTORICAL PERIOD | 2020-2022 |
UNIT | Value (USD Billion) |
KEY COMPANIES PROFILED | Shell plc, Chevron Corporation, Exxon Mobil Corporation, China National Petroleum Corporation, BP PLC, TAIF-NK (Russia), KazMunayGas (Kazakhstan), Axeon Specialty Products (US), Neste (Finland). |
SEGMENTS COVERED | By Grade Type, By Application, By End-Use Industry, And By Geography. |
CUSTOMIZATION SCOPE | Free report customization (equivalent to up to 4 analyst’s working days) with purchase. Addition or alteration to country, regional & segment scope. |
Analyst’s Take
According to Market Research, the Vacuum Gas Oil Market is poised for significant growth in the forecast period. Key factors driving this growth include the rising demand for transportation fuels, increasing industrialization, and urbanization in emerging economies. Additionally, technological advancements in refining processes are enhancing the efficiency and yield of VGO, further boosting market expansion. However, challenges such as fluctuating crude oil prices, stringent environmental regulations, and competition from alternative energy sources may hinder market growth to some extent. Nevertheless, strategic initiatives by key market players, such as capacity expansions, mergers, and acquisitions, are expected to create lucrative opportunities for growth in the Vacuum Gas Oil Market.
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• Qualitative and quantitative analysis of the market based on segmentation involving both economic as well as non-economic factors• Provision of market value (USD Billion) data for each segment and sub-segment• Indicates the region and segment that is expected to witness the fastest growth as well as to dominate the market• Analysis by geography highlighting the consumption of the product/service in the region as well as indicating the factors that are affecting the market within each region• Competitive landscape which incorporates the market ranking of the major players, along with new service/product launches, partnerships, business expansions and acquisitions in the past five years of companies profiled• Extensive company profiles comprising of company overview, company insights, product benchmarking and SWOT analysis for the major market players• The current as well as the future market outlook of the industry with respect to recent developments (which involve growth opportunities and drivers as well as challenges and restraints of both emerging as well as developed regions• Includes an in-depth analysis of the market of various perspectives through Porter’s five forces analysis• Provides insight into the market through Value Chain• Market dynamics scenario, along with growth opportunities of the market in the years to come• 6-month post-sales analyst support
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