The global petroleum liquid feedstock market size was valued at USD 313 billion in 2023 and is projected to reach a value of USD 474.1 billion by 2032, registering a CAGR of 4.72% during the forecast period (2024-2032). The increase in petroleum liquid feedstock market share during the forecast period is related to the demand for plastic and rising oil prices.
A raw material utilized in the manufacturing process to generate energy is referred to as feedstock. The petroleum liquid feedstock is a mixture of several different kinds of hydrocarbons, all of which are highly flammable and very volatile in their natural state. It is primarily obtained by distilling coal, petroleum, and wood as the primary starting materials. Naphtha, for example, is one of the petroleum products extracted and acquired by refining crude oil. It is utilized as feedstock for the industries of petrochemicals and fertilizer.
Increased technological advancements are the primary market drivers for the petroleum liquid feedstock market. The transportation sector is the primary driver of the demand for petroleum liquid feedstock. Local transportation, which encompasses engine vehicles, motor vehicles, bunkers, and marine fuel, employs petroleum liquid feedstock, naphtha, and oil. This fuel is found in the industrial and commercial sectors.
Natural gas oil is a crucial input for plastic production and is difficult to transport. Petrochemical manufacturers strongly depend on natural gas oils or ethane as a feedstock. The U.S. shale gas boom highly drives the new plastics infrastructure in the Gulf region. Naphtha is another essential element for plastic products extracted from oil refining. The production of naphtha is done in crucial oil companies with refining capacity. The five prominent players, namely Chevron, Shell, British Petroleum, ExxonMobil, and China National Petroleum Corporation, account for over half the global naphtha sales. The plastic packaging used for food and other commercial products is derived from petrochemical products, including polyethylene and polystyrene.
Thus, the massive demand for plastic will eventually drive the petroleum liquid feedstock market. As per the International Energy Agency, advanced economies of the world, such as the U.S. and those in Europe, currently use as much as 20 times more plastic compared to developing countries, such as Indonesia and India, on a per capita basis. This offers an enormous break for the increasing demand for petroleum liquid feedstock. For instance, in 2023, U.S. plastic production reached 125 million metric tons, a significant rise from previous years, indicating a continual surge in demand for petrochemical feedstocks.
Despite the considerable rise in recycling, measures to repress the single-use plastics are gaining traction, particularly in Europe, Japan, and Korea. With a significant amount of harmful plastic litter in oceans and seas, the European Commission proposed new EU-wide rules to target the ten most single-use plastic products found on the sea and beaches of Europe. Put together, these single-use plastic products constitute 70% of all marine litter.
Consequently, the proposed regulations are expected to bring both environmental and economic benefits, such as preventing the emission of almost 3.4 million tons of CO2 equivalent. These efforts are expected to be offset as developing countries are rapidly increasing their plastic consumption. The unavailability of alternatives for petroleum liquid products is another drawback that will impact the market's growth.
The oil and gas prices crash of 2014–2016 adversely impacted the petroleum refining market along with the petroleum liquid feedstock market. However, the markets have recovered, with oil prices reaching almost USD 70 per barrel in 2017 from USD 40 per barrel in 2014. As of 2024, oil prices have fluctuated around USD 85 per barrel, reflecting a volatile yet upward trend. The petrochemical industry is a crucial driver for the petroleum liquid feedstock market. Transportation, construction, and plastic, among other end-use sectors, propel the demand for petrochemical products, eventually contributing to the growth of the petroleum liquid feedstock market.
Globally, oil consumption is enhancing the growth of the petroleum liquid feedstock market and calling for significant expenditure and substantial investment. For instance, the global upstream CAPEX for oil and gas increased by 4% in 2019 and continued to rise, with projections estimating a 6% increase in 2024, indicating robust investment trends in the sector.
Price volatility may serve as a substantial constraint on the global market for conveyor belts. Changes in the prices of raw materials, particularly concerning the rubber and synthetic materials utilized in the making of conveyor belts, have the potential to affect production costs, which in turn can impact the pricing of conveyor belts. As a result of this volatility, both manufacturers and consumers may experience uncertainty, making it difficult to estimate and effectively control costs accurately.
Furthermore, rapid pricing changes can potentially throw supply chains into disarray, affect profit margins, and impact investment decisions within the conveyor belt business. Price volatility brings instability and unpredictability into the market, affecting buyers and sellers. For instance, crude oil prices, a significant determinant of feedstock prices, have experienced a range of USD 50 to USD 120 per barrel over the past decade, leading to significant fluctuations in downstream product pricing.
The rising prevalence of aging refineries creates a favorable circumstance for the worldwide petroleum liquid feedstock market by stimulating requirements for refinery process enhancements, maintenance, and upgrades. Modernization is frequently necessary to improve aging refineries' efficiency, safety, and reliability. To optimize processes and reduce operational expenses, this generates a need for real-time crude feedstock analysis technologies such as On-line Process Nuclear Magnetic Resonance (OP-NMR). Refinery infrastructure can be made more durable and secure by implementing upgrades, such as substituting obsolete materials for storage facilities and aging pipelines, effectively mitigating the likelihood of leaks and failures. Improving water supply and fire suppression systems can contribute to improving safety and operational efficiency in aging refineries.
For instance, the average age of refineries in the United States, which is 74 years, highlights the significant need for such upgrades. Furthermore, the emerging phenomenon of micro refineries in developing nations presents an adaptable and economical alternative for expeditiously augmenting refining capacity and satisfying the need for premium goods. Mini refineries enable the local production of petrochemical feedstocks and premium fuels, thereby decreasing reliance on imports and providing opportunities for expansion.
| Study Period | 2020-2032 | CAGR | 4.72% |
| Historical Period | 2020-2022 | Forecast Period | 2024-2032 |
| Base Year | 2023 | Base Year Market Size | USD 313 billion |
| Forecast Year | 2032 | Forecast Year Market Size | USD 474.1 billion |
| Largest Market | North America | Fastest Growing Market | Europe |
The global petroleum liquid feedstock market analysis is conducted in North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.
North America is the most significant market shareholder and is estimated to grow at a CAGR of 4.2% over the forecast period. North America is responsible for a sizeable share of the global petroleum liquid feedstock market, with the United States maintaining its position as the market leader. An increase in investments in oil and gas projects, such as Alaska LNG and Driftwood LNG, is anticipated to ensure the region maintains its dominant position. For instance, the Alaska LNG project, estimated at USD 43 billion, aims to export liquefied natural gas to Asian markets, boosting the region's output and influence.
Similarly, the Driftwood LNG project, valued at USD 25 billion, has secured significant investment to enhance its production capacity. The presence of well-known manufacturers in the region, such as Kuriyama of America, Inc., Parker-Hannifin Company, and Gates Industrial Corporation plc, further contributes to the region's expansion. In July 2024, Parker-Hannifin recently announced a USD 1.2 billion acquisition of a leading fluid control company, enhancing its product portfolio and market reach. These developments underscore North America's pivotal role in the global market.
Europe is estimated to grow at a CAGR of 4.7% over the forecast period. Europe, led by Russia, is another crucial player in the international petroleum liquid feedstock market. The expansion of the European oil and gas industry is anticipated to be driven by stringent regulations imposed by governments and consistent policies designed to assist the industry. For instance, the European Union's Green Deal, which includes measures to reduce carbon emissions and promote sustainable energy sources, is spurring investments in cleaner technologies within the oil and gas sector.
Furthermore, activities related to research and development that result in innovations and raw materials are also contributing to the region's expansion. In 2024, Russia's Gazprom Neft announced a breakthrough in refining technology, enhancing its operations' efficiency and environmental performance. This focus on innovation and regulatory support positions Europe as a crucial player in the global market.
The Asia-Pacific region is anticipated to hold the most significant market share by the end of 2035, with a projected value of 32 percent. This region is experiencing rapid economic expansion, urbanization, and an increase in energy demand, all of which present prospects for Gas-to-Liquid (GTL) technology to monetize natural gas resources and satisfy the r. For instance, China's Belt and Road Initiative is driving substantial investments in infrastructure, including energy projects, which are expected to fuel the demand for petroleum liquid feedstocks. In 2024, India's Reliance Industries announced a USD 10 billion investment in expanding its petrochemical complex, further highlighting the region's growth trajectory. The increasing focus on energy security and the adoption of advanced technologies are pivotal in Asia-Pacific's dominant market position.
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The global petroleum liquid feedstock market is segmented based on type and end product.
The market is further segmented by type into naphtha (Heavy Naphtha, Light Naphtha) and gas Oil.
Heavy naphtha has a boiling point of around 370°F to 160°F (C11). Primarily composed of alkanes and cycloalkanes. Appropriate for hefty naphtha reformers as feed. Heavy naphthas with an N+A content of less than 35% are excluded. Comprises an excess of heavy naphtha of excellent or slightly inferior quality blended with paraffinic naphtha of the full range. Refineries produce the majority. They are utilized in various industries, including mogas and avgas reforming, aromatics, direct blending of motor gasoline, and blending of full-range naphtha.
Light Naphtha pentane is a material that is marginally denser in composition and produced through crude oil distillation or NGL fractionation plant separation. Employed as a feedstock for petrochemicals or combined into gasoline and frequently subjected to isomerization before combining to increase octane. They are utilized in steam processors as a feedstock to produce ethylene and plastics, competing with propane and ethane. They are preferred for improved yields in steam processors due to their highly paraffinic composition.
Gas oil is commonly defined as the intermediate distillate fraction of crude oil that is not confused with naphtha and is utilized for heating oil, diesel fuel, and other purposes.
The market is further segmented by end product into ethylene, benzene, propylene, hexane, and naphthalene.
Ethylene is formed when naphtha is subjected to steam cracking (pyrolysis) at high temperatures. Ethylene is a light olefin that is created under these conditions. Furthermore, it is the primary raw material utilized in manufacturing polyethylene, ethylene oxide, and various other chemicals. Using HCR or HVGO, ethylene yield is essentially identical to breaking naphtha, which is approximately 26%.
In the process of cracking, an aromatic hydrocarbon known as benzene is produced. Under normal cracking conditions, benzene does not change in any way. The production of a wide variety of products, such as synthetic resins, synthetic rubber, synthetic fiber, dye, and medicine, begins with using this fundamental feedstock in petrochemistry.
Propylene is another light olefin formed when naphtha is subjected to steam cracking (pyrolysis) at high temperatures. Propylene is produced when such a process is carried out. It is a primary raw material utilized in manufacturing many chemicals, including polypropylene, propylene oxide, and others.
Hexane is a hydrocarbon with six carbon atoms and a naphtha component. Hexane is also known as hexane. As a solvent, it is utilized in a wide range of industrial applications, such as manufacturing rubber, medicines, and culinary oils.
Lockdown imposed across the globe has severely impacted the healthcare CRO market due to the cancellation and suspension of new and ongoing research activities. Some of the CROs such as IQVIA and Parexel are operating with elevated financial leverage as they have limited cushion to absorb losses. However, the pharmaceutical giants are actively working to develop a vaccine for the treatment of COVID-19, driving market growth.
