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Hydraulic Fluids Market

Hydraulic Fluids Market: Information by Type (Mineral Oil, Synthetic Oil), End-User (Oil and Gas Industry, Automotive Industry), and Region — Forecast till 2030

Published At : 01 Aug, 2022
Updated At : 01 Aug, 2022
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Market Snapshot
Base Year:
2021
Study Period:
2020-2030
CAGR:
6.8 %
Fastest Growing Market:
North America
Largest Market:
Asia Pacific

The global hydraulic fluids market size was valued at USD 8.96 billion in 2021. It is expected to reach USD 16.20 billion by 2030, growing at a CAGR of 6.8% during the forecast period (2022–2030). In hydraulic systems, the transmission of power is accomplished through hydraulic fluids. These fluids are likely to be used in hazardous environments, where the liquid may catch fire if it gushes out of pipes or leaks through while the system is operating. Even though these fluids have good fire-resistance properties, they have a significantly lower number of downsides than petroleum-based fluids. Mineral oil, synthetic oil, and bio-based oil are the three categories of available hydraulic fluids. Mineral oil and hydraulic fluids find employment in various industries, including automatic gearboxes in automobiles, power steering units, elevators, farm equipment, mining, energy, chemical manufacture, metals, and machining.

In the earlier years, among all the different kinds of hydraulic fluids available on the market, the segment comprised of mineral fluids has been experiencing substantial growth worldwide. These factors include an increase in the production and demand for automotive vehicles, an increase in the requirement for vehicle servicing and reconditioning activities, an expansion of the overall economy, and an expansion of the industrial manufacturing output. Mineral lubricant is highly adopted due to low emissions of volatile compounds and a relatively thicker layer than a traditional oil, contributing to the growth of the global market.

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Market Dynamics

Market Driving Factors

Increase in Automobile Manufacturing and Sales to Impede the Market Growth

The market for passenger and commercial vehicles reached an all-time high, resulting in tremendous growth for the international automotive sector. The automobile market is rapidly increasing in emerging economies like India, China, Brazil, and others. In addition, the developed regions such as North America and Europe account for the lion's share of the total demand share in terms of production and sales of automobiles. China has been the significant country-level market with the highest production and sales statistics. It is primarily attributable to technological advancements, superior manufacturing facilities, and a drastic rise in the country's population, contributing to the high demand for vehicles. Synthetic lubricants are used in the overall system as various products, such as hydraulic oil, gear oil, engine oil, brake fluid, and transmission fluid. These products enhance the vehicle's overall life cycle by reducing the amount of friction between surfaces and eliminating the heat generated by the automotive component. In addition, synthetic hydraulic oil has improved hardware compatibility with contemporary automobile components and contributes to reducing vehicle emissions.

Increase in Consumer Preference for Synthetic Lubricants to Aid Growth

The automakers have shifted their focus to producing durable automobile components, such as engines that can be placed in passenger cars, light commercial vehicles, and heavy commercial vehicles. Synthetic lubricants are distinguished from conventional lubricants by their superior viscosity-temperature behavior, compatibility with a broad range of hardware, good oxidation stability, and, most importantly, reduced evaporation rates. Adopting these features into contemporary automobile design increases the vehicle's prospective longevity, a desirable result. In the end, customer acceptance of synthetic lubricants drives the expansion of this market, increasing consumer acceptability of synthetic lubricants.

Creating a Worldwide Transportation Network

The most popular modes of transportation in every region of the world are railroads and large commercial trucks and buses. The global transportation infrastructure is developing rapidly due to the increased global population and the need for efficient transportation facilities. Transportation and mobility are directly correlated to a nation's level of overall output as well as employment and income levels within the economy. In several countries, the transportation sector contributes between 6 and 12 percent of the gross domestic product. Thus, there has been a significant surge in demand for commercial vehicles due to the rapidly increasing nature of the transportation and logistics industry.

On the other hand, governments' investments to improve transportation facilities and the growth of the logistics industry are some of the major factors anticipated to boost the demand for efficient transportation, which drives the consumption of synthetic lubricants. Additionally, there is an expectation of a rise in the average age of the population, which is another aspect that is anticipated to boost the demand for efficient transportation. As a result, this drives the expansion of the market in the years to come.

Market Restraining Factors

Fluctuating Prices of Raw Resources to Restrict Market Growth

Manufacturing hydraulic fluids begin with extracting crude oil, the foundational ingredient. The increase in the cost of crude oil is a significant factor in the total rise in the price of lubricants. Despite having only 5% of the world's overall population, the United States is responsible for approximately 25% of the world's total oil consumption and imports 66% of the whole amount. Thus, as crude oil prices rise, demand for natural lubricants will increase, potentially raising the price of synthetic lubricants. Even though there has been an upsurge in the total output of crude oil, there is anticipated to be a fall in demand due to the abundant supply. This, on the other hand, can lead to a significant decrease in the price of crude oil. As a result, one of the preliminary issues that pose a challenge to expanding the global market for hydraulic fluids is the volatility in the pricing of raw materials.

Key Market Opportunities

Expansion in the African Infrastructure and Industrialization to Boost Market Opportunities

The slow expansion of the African continent can be attributed to several factors, including inadequate economic growth and infrastructure. European nations have been encouraged to participate in Africa's industrial manufacturing sector due to the expanding trade between countries and the rise in export operations directed toward Africa. In response to the region's growth potential, several of the world's largest oil and gas companies have made investments in African oil and gas projects. Consequently, there is a more significant potential for industrialization in the African region, which is predicted to present attractive growth possibilities for the market for hydraulic fluids.

 

Segmental Analysis

The global hydraulic fluids market is segmented by Oil Type and End-User.

By Oil Type

Based on oil type, the global hydraulic fluids market is classified into Mineral Oil, Synthetic Oil, and Bio-Based Oil.

Mineral oil is the most dominant in the global hydraulic fluids market and is expected to grow at a CAGR of 6.8% during the projection period. Mineral oil-based hydraulic fluids are processed with specified additives from paraffin-based crude oils, including high-pressure additives, anti-wear additives, corrosion inhibitors, oxidation inhibitors, and defoamers. Mineral oil-based hydraulic fluids offer several benefits like temperature stability, less fluid maintenance, system dependability, and low cost. Hydraulic fluids based on synthetic oil are generated by combining numerous synthetic components. Synthetic oil-based hydraulic fluids improve the overall functionality and durability of a vehicle, protecting it from wear and tear, friction, and extreme temperatures. Increasing consumer preference for high-quality synthetic automobile lubricants is driving market expansion. Automotive lubricants illustrate the prospective technology of producing resilient surfaces, maximizing total efficiency. There are a variety of synthetic oil-based fluids, including polyethylene glycol (PAG), polyalphaolefin (PAO), and ester oil.

By End-User Industry

Based on the end-user industry, the global hydraulic fluids market is classified into Oil and Gas, Automotive, Marine, Aerospace and Defense, and Construction.

Oil and gas own the highest market share and is expected to grow at a CAGR of 7.1% during the forecast period. Hydraulic systems are commonly employed to convey power in the oil and gas exploration, production, and refining industries. These systems are situated where oil and gas can seep into the marine environment. Hydraulic fluids are in high demand due to applications in the oil and gas industry, such as lifting heavy loads, turning shafts, and drilling precise holes. In the oil and gas industry, hydraulic fluids are utilized for lubrication, heat transfer, contaminant control, and corrosion control, among other applications. Hydraulic fluids are used in various automobile applications, including engine components, brake systems, and transmissions. Automotive applications that utilize hydraulic fluids include forklifts, tractors, and automobiles. The marine sector is one of the largest consumers of hydraulic fluids for applications such as steering systems, tanks, bow-and-stern thrusters, shell doors, and cruise ships. It is utilized in the marine sector to strengthen stabilizers.

 

Regional Analysis

The global hydraulic fluids market is primarily classified into four regions, namely North America, Europe, Asia-Pacific, and LAMEA.

Hydraulic Fluids Market Regional Analysis

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Asia-Pacific dominates the global hydraulic fluids market and is expected to grow at a CAGR of 7.1% during the forecast period. China, Japan, India, South Korea, and Australia are the primary contributors to this region's growth. In addition, Asia-rapid Pacific's population growth and rising economy are driving the expansion of the construction and automotive industries. This region's increase is primarily attributable to China's automotive solid production and sales. In addition, Asia-rapid Pacific's population growth and rising economy are driving the expansion of the construction and automotive industries. Rapid urbanization growth in China, Indonesia, and India is expanding the market for passenger cars.

In North America, the United States is the leading producer and consumer of hydraulic fluids. Canada and Mexico are two other nations in the region that provide enormous potential for hydraulic fluids. These fluids are in high demand from the oil and gas, automotive, and construction industries.

Europe retains the third position in the market for hydraulic fluids, with the automotive industry segment dominating. Germany, France, the United Kingdom, Italy, and Spain are the most significant contributors to this region's revenue. The Europe region is expected to grow significantly, owing to its proximity to regulatory bodies that control new emission standards, which benefits manufacturers. Europe's robust mass vehicle market is expected to influence the demand for synthetic hydraulic fluids.

 

Competitive Analysis

List of Key Companies Profiled

  • bp P.L.C.
  • Chevron Corporation
  • Eastman Chemical Company
  • Exxon Mobil Corporation
  • Gazprom NEFT PJSC
  • Lukoil
  • Petroliam Nasional Berhad (Petronas)
  • Royal Dutch Shell Plc
  • Sinopec Group
  • Total Se.

Recent Developments

  • May 2022- Abu Dhabi’s ADNOC and Masdar to join bp’s UK hydrogen projects.
  • May 2022- Chevron, Talos, and Carbonvert announce closing the previously announced joint venture expansion of the Bayou Bend CCS project offshore Jefferson County, Texas.
  • April 2022- Maip Group announces new sustainable polymers for the European automotive market using Eastman’s molecular recycling technologies.
  • May 2022- ExxonMobil and Indonesia's Pertamina to advance carbon capture and storage cooperation.

Global Hydraulic Fluids Market: Segmentation

By Type

  • Mineral Oil
  • Synthetic Oil
  • Bio-based Oil

By End-User

  • Oil and Gas Industry
  • Automotive Industry
  • Marine Industry
  • Aerospace and Defense Industry
  • Construction Industry

By Regions

  • North America
  • Europe
  • Asia-Pacific
  • LAMEA
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