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The Liquified Petroleum Gas (LPG) Tanker Market size is forecasted to increase by USD 61.19 million, at a CAGR of 3.81% between 2022 and 2027. Market expansion hinges on several key factors, notably the augmented supply of natural gas, spurred by advancements in extraction technologies. Additionally, robust government backing for liquefied petroleum gas (LPG) adoption amplifies market growth prospects. Furthermore, the escalating transportation of LPG via tanker vessels bolsters market dynamics, facilitating efficient distribution networks. These factors collectively underscore the pivotal role of regulatory support, technological innovations, and logistical infrastructure enhancements in driving the growth trajectory of the LPG market. As demand continues to surge, stakeholders must prioritize sustainable practices and infrastructure development to meet evolving consumer needs. Furthermore, the report includes historic market data from 2017 to 2021.
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The semi refrigerated segment, propelled by the increased focus on the production of shale gas and the adoption of horizontal drilling methods to extract resources from shale rock formations, has witnessed significant growth. This growth is further supported by the reduced cost of transportation facilitated by Type C tanks used in liquified petroleum gas (LPG) tankers. However, the segment faces challenges due to the instability in crude oil prices, which impact liquefied petroleum gas demand, leading to fluctuations in market dynamics. Further, this market report extensively covers market segmentation by application (residential and commercial), type (very large gas carrier, large gas carrier, medium gas carrier, and small gas carrier), and geography (Europe, North America, APAC, South America, and Middle East and Africa).
The market share by the residential segment will be significant during the forecast period. Residential end-users include households, apartments, and private homes that consume LPG. In the residential sector, LPG is a highly versatile source of energy and can be used across a wide range of applications, such as water and space heating and cooling. In developing countries, LPG is used for lighting where electricity is unavailable, while in developed countries, LPG is used for outdoor activities such as barbecues and camping. As LPG-fired electricity is cleaner, it is preferred by residential end-users.
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The residential segment was valued at USD 164.94 million in 2017. LPG has various economic and environmental advantages over other fuels. The use of LPG in the residential sector is high. It has a high calorific value in liquid form, which reduces transportation costs. Therefore, LPG is convenient to handle when compared to other oil-based fuels, coal, and wood. LPG is a clean-burning fuel and can be used in direct contact with food without any risk of contamination. Hence, the benefits of using LPG as well as government initiatives to promote the same are expected to drive the growth of the residential segment of the global market during the forecast period.
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Europe is estimated to contribute 42% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. The growth of the market in the region is attributed to factors such as the growth in the production of petroleum products and imports of crude oil. The transport sector is heavily dependent on oil products. In May 2021, oil traders provisionally booked around six tankers to ship gasoline from Europe to US destinations. Such developments are expected to drive the growth of the market in Europe during the forecast period. The regional market is dominated by Western Europe and Russia, driven by numerous oil and gas exploration projects in the North Sea. For instance, BP PLC invested USD 150 billion in May 2022 to develop the Murlach oil field in the North Sea by 2025. Such projects will drive the growth of the market in the region during the forecast period.
The market is experiencing fluctuations due to crude oil price volatility and the expansion of hydraulic fracturing. With the rise of shale gas and the growth of petrochemical industries, there's a renewed focus on LPG transportation. Companies like Exmar and initiatives like Flanders Innovation are driving recovery in the market, leading to increased orders for LPG vessels. Efforts to reduce CO2 emissions through improved refrigeration and pressurization systems highlight the industry's commitment to sustainability amidst growing demand for ammonia and ethylene. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The increase in the supply of natural gas is notably driving market expansion. Natural gas is the fastest-growing fossil fuel, with a rise in the supply of coalbed methane, shale gas, and tight gas. Hence, the production of unconventional oil and gas resources such as natural gas has increased significantly in the global oil and gas industry. According to International Energy Agency (IEA), natural gas consumption grew from 3,630 billion cubic meters in 2016 to 4,000 bcm in 2022.
Further, according to IEA, natural gas production in the US accounted for 40% of global natural gas output growth from 2017 to 2022. The US produced 890 bcm or 22% of the global natural gas in 2022. Russia is the second-largest producer of natural gas in the world, and there is substantial under-utilized natural gas production capacity in the Yamal peninsula. Such initiatives will likely fuel the growth of the market growth throughout the forecast period.
Technological advances is a key trend shaping market development. One of these advances is the development of cross-compound double-reduction steam turbines. These steam turbines are compact and take up less space in the ship engine room. Marine two-stroke diesel engines have replaced marine steam turbine engines, as they are more economical for commercial purposes.
Further, the introduction of the controllable pitch propeller (CPP) for running tanker ships is another technological advancement. This enables transporting more volume of goods using tankers. Innovation in the propulsion system can be attributed to the GDF SUEZ Global Energy and Provalys vessels. These vessels can be driven by dual-fuel diesel-electric propulsion systems. The propulsion system can utilize diesel, oil, and steam-boiled-off- gases, which enhances the vessel's efficiency by 25%-30% compared to conventional propulsion systems. Such technological advancements are expected to propel the development of the market during the forecast period.
Fluctuations in crude oil prices may impede market growth. These fluctuations adversely impact the end-user industries of the market. As per the IEA, in October 2018, the average cost of crude oil was USD 73.6/bbl. However, in H1 2022, the average cost of crude oil reached more than USD 100/bbl.
Additionally, unexpected price fluctuations affect the market adversely. The recent frequent volatility in crude oil prices has also negatively impacted the petroleum industry. These fluctuations can lead to disruptions in the oil and gas industry, which will ultimately impact investments in the market. Thus, fluctuations in global crude oil prices will challenge the growth of the market during the forecast period.
The market report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the market forecasting report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
DAE SUN SHIPBUILDING and ENGINEERING CO. LTD. - The company offers an LPG carrier that is designed to carry 3500 cubic meters of LPG fuel.
The research report also includes detailed analyses of the competitive landscape of the market and information about 16 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companiesas dominant, leading, strong, tentative, and weak.
The market report forecasts market growth by revenue at global, regional, & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
The market is experiencing significant growth, driven by the increasing focus on shale gas production and the renovation of existing fleets to meet the demand for liquefied petroleum gas (LPG). Vessels come in various sizes, including Very Large Gas Carriers (VLGC), Large Gas Carriers (LGC), medium gas carriers (MGC), and Small Gas Carriers (SGC), equipped with specialized cargo tanks like Type C tanks. The market is witnessing a surge in demand due to amplified prices of LPG and the rise in LPG trade, prompting the development of dual-fuel LPG carriers and the enhancement of refrigeration and pressurization systems. This growth is further fueled by the increasing export of domestic LPG and the need for LPG carriers to transport it over long distances.
Additionally, the market is witnessing dynamic developments as the industry focuses on renovating existing fleets to meet growing demands. Innovations like dual-fuel free VLGC tankers and advancements in tank insulation and refrigeration & pressurization systems cater to the increasing demand for liquefied petroleum gas (LPG) tankers. Factors such as volatile crude oil prices and the rise in LPG trade are driving the need for efficient transportation solutions over longer distances. With rapid industrialization and a surge in LPG exports, the market experiences steady growth, necessitating the adoption of separate cargo tanks and specialized vessel sizes to accommodate the diverse requirements of the industry.
Furthermore, The focus on the production of shale gas has led to an increased demand for Type C tank, especially considering the growing demand for liquefied petroleum gas tankers. This trend is further accentuated by the need for larger ship sizes and enhanced decompression capabilities, driven by the requirements of the steel industry and the production of oil and gas. However, weaker demand in certain markets may temper overall market growth. Further, ship size and vessel size have become crucial factors in the maritime industry, especially with new orders increasingly favoring dual-fuel LPG carriers equipped with additional freezing systems. These carriers come in various configurations, including cylindrical, conical, and spherical, catering to diverse market needs. With a rise in the demand for LPG, driven partly by low domestic production, smaller ship carriers are gaining prominence in fulfilling logistical requirements.
Market Scope |
|
Report Coverage |
Details |
Page number |
150 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 3.81% |
Market growth 2023-2027 |
USD 61.19 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
3.4 |
Regional analysis |
Europe, North America, APAC, South America, and Middle East and Africa |
Performing market contribution |
Europe at 42% |
Key countries |
US, China, Japan, Germany, and France |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Air and Gas Holdings Pty Ltd., Bosco India, BW Group, DAE SUN SHIPBUILDING and ENGINEERING CO. LTD., Dorian LPG Ltd., Exmar NV, GLOBE GAS EQUIPMENTS INDUSTRY PVT. LTD., HD Hyundai Co. Ltd., Kawasaki Heavy Industries Ltd., Krison Engineering Works, Kuwait Oil Tanker Co. SAK, Mitsubishi Heavy Industries Ltd., Nakilat, Namura Shipbuilding Co. Ltd., Solvang ASA, StealthGas Inc., STX Corp., The Great Eastern Shipping Co. Ltd., PT Pertamina Persero, and Teekay Corp. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Application
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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