Oil and Gas Storage Service Market Analysis North America, Middle East and Africa, APAC, Europe, South America - US, Saudi Arabia, China, Russia, Canada - Size and Forecast 2024-2028

Oil And Gas Storage Service Market Size 2024-2028

The oil and gas storage service market size is forecast to increase by USD 3.99 billion at a CAGR of 5.11% between 2023 and 2028. The market's growth is driven by several key factors, including the increasing global demand for oil and gas, the rising use of natural gas for power generation, and heightened investments in oil and gas pipeline projects. As the world seeks more energy sources, the need for efficient and reliable pipeline infrastructure becomes crucial. Additionally, the shift towards natural gas as a cleaner alternative for power generation is bolstering market expansion. Significant financial commitments to developing and upgrading oil and gas pipelines are also playing a pivotal role in sustaining and accelerating market growth. These factors collectively underscore the sector's robust growth trajectory. Our report examines historic data from 2018 - 2022, besides analyzing the current and forecasted market scenario.

Market Forecasting and Size

Market  Forecast 2024-2028

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Market Dynamic

The market is driven by factors such as increasing oil supply, expanding refining capacity, and rising investments in oil storage infrastructure. Trends include the adoption of IoT integration for improved efficiency and a focus on environmental sustainability. Rapid industrialization and urbanization demand more storage space and better safety requirements for oil storage facilities. Challenges include fluctuating crude oil prices, maintaining a high safety rate, and ensuring oil price stability amidst economic and geopolitical uncertainties. The market's growth is crucial for the energy supply chain and overall economic development. Our researchers studied the market research and growth data for years, with 2023 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market.

Key Driver - Rising use of natural gas in power generation

Natural gas is gradually replacing other fossil fuels for electricity generation. It is gaining popularity around the world as a fuel for power generation. Not only does natural gas have a lower carbon footprint, it is also considered an ideal substitute for coal. This will increase the demand for natural gas. As the demand for fuel increases, the need for these services at distribution centers is expected to increase.

Additionally, a continuous and uninterrupted supply of natural gas for power generation requires adequate gas storage facilities to store excess gas. This will increase the need for increased capacity, contributing to the growth of the global market during the forecast period.

Major Trends - Increasing adoption of digital technologies to optimize oil and gas storage operations

Digitization and the Internet of Things (IoT) are significantly transforming the global market by introducing innovative technologies that improve efficiency, safety, and reliability across the industry. One of the important aspects of industrial digitization is the application of IoT devices and sensors. These sensors are mainly placed in these facilities to collect real-time data on various parameters including temperature, pressure, humidity, and device status.

In addition, digital solutions improve security by monitoring access to critical infrastructure and ensuring compliance with security protocols. Hence, the rising adoption of digital technologies to enhance these operations is expected to fuel the growth of the market during the forecast period. 

Significant Challenge - Volatility in oil and gas prices

Crude oil price volatility is one of the biggest challenges facing the industry, as the volatile price environment can have a severe impact on new exploration and production (E&P) investment, refinery expansion, and contract prices. This could affect demand for these services. Any unforeseen price movement can change the course of the entire market in a short time. The oil and gas industry is affected by frequent fluctuations in crude oil prices.

Furthermore, the drop in oil and gas prices in the market has a direct impact on customers using warehousing services, putting pressure on the entire value chain. Volatility in oil and gas prices can directly affect the contract prices of these providers, resulting in low profits or unsustainable operations, which may impede the growth of the market during the forecast period. 

Market Segmentation by Application, Service, and Geography 

Application Segment Analysis: 

The power plants segment will account for a major share of the market's growth during the forecast period.?Power plants play an important role in the production of electricity and their reliable operation depends on an available and safe source of fuel, such as natural gas or oil. These plants depend on natural gas or diesel fuel to get up to speed quickly and generate electricity when needed. To ensure uninterrupted supply during peak times, these plants have on-site storage tanks filled with the necessary fuel. The for power plants must be carefully managed to avoid supply disruptions.

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The power plants segment was valued at USD 4.05 billion in 2018. Environmental considerations are rising influencing fuel choices in power plants, with a shift towards cleaner options such as natural gas or renewable energy sources. This transition could negatively impact demand for traditional petroleum-based storage solutions in the power generation segment. However, as the grid continues to depend on a combination of multiple energy sources, this will still be necessary to ensure grid stability and energy security in extreme situations, thereby driving the growth of the market in the power plants segment during the forecast period.

Service Segment Analysis:

Based on service, the market has been segmented into storage services and ancillary services. The storage services?segment will account for the largest share of this segment. One of the main roles of these services is to act as a buffer in the energy supply chain, bridging the gap between production and consumption. During periods of overproduction, surplus oil and gas can be stored for future use, but during periods of high demand or production disruptions, reserves are stored to maintain a steady supply. Additionally, global population growth and increased demand for petroleum products from emerging markets are driving development and refinery companies to expand production. Rising demand for oil and gas will increase the need for these services, which will drive the growth of the segment during the forecast period.

Regional Analysis

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North America is estimated to contribute 28% to the growth by 2028.  Technavio's analysts have provided extensive insight into the market forecasting, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period.  The North American market is dominated by the US and Canada. The region has the world's largest capacity. Increased oil consumption requires high capacity to store, which leads to new demand for these services.

Furthermore, the most important storage and trading centers in North America are Cushing (US), Houston (US), and Alberta (Canada). As US exports of crude oil and refined products through the Gulf Coast increase, storage and trade centers like Houston are investing more in these terminals. Cushing is a relatively mature petroleum terminal that has been expanded in the past few years. This nearly doubled Cushing's total production capacity will drive the growth of the regional market during the forecast period. 

Key Companies & Market Insights

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.

Compagnie Industrielle Maritime: The company offers storage tanks that has a capacity of 1.2 million CBM and 450 storage tanks.

We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including:

Brooge Energy Ltd., Buckeye Partners LP, Burns and McDonnell, Compagnie Industrielle Maritime, Emirates National Oil Co. Ltd. LLC., Enbridge Inc., Energy Transfer LP, Exolum Corp. S.A., Fluor Corp., IMTT, Kinder Morgan Inc., Koninklijke Vopak NV, LBC Tank Terminals, Marquard and Bahls AG, McDermott International Ltd., NOV Inc., NuStar Energy L.P., Odfjell SE, ONEOK Inc., and Plains All American Pipeline L.P. 

Technavio market forecast the an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies companies into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Companies are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.  

Segment Overview

The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.

• Application Outlook
  • Power plants
  • Oil refineries
  • Chemical plants
  • LNG storage facilities

• Service Outlook 
  • Storage services
  • Ancillary services

• Region Outlook 
  • North America
    • The U.S.
    • Canada
  • Europe
    • U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • South America
    • Chile 
    • Brazil 
    • Argentina
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

Market Analyst Overview

With a focus on Strategic reserves and Liquid storage solutions, the market ensures efficient Storage management while adhering to these regulations. Proper Storage maintenance and Leasing are essential for operational success. Technological advancements in Storage technology have improved Storage Safety and optimization. As the industry continues to evolve, the demand for these services is expected to grow, driving innovation and efficiency in the sector. The Market is integral to managing the supply chain of the energy sector, addressing the fluctuating demands and ensuring oil price stability. The market's growth is influenced by the increasing global oil and gas production, necessitating expanded storage infrastructure like above ground tanks, underground tanks, and strategic oil reserves. As refining capacity and the production of refineries rise, the demand for storage space increases, driven by oil and gas producers, distributors, and traders. Environmental impacts and climate change have prompted the industry to adopt sustainable practices and comply with stringent safety regulations and labor standards regulations to avoid penalties, reputational damage, and legal consequences. The sector invests in safety measures, automation, and data analytics to enhance the quality of service and safety rate.

Moreover, storage facilities are equipped with loading and unloading facilities, mixing facilities, and quality control measures to maintain the integrity of valuable products like jet fuel and petrochemicals. The market landscape depends on gasoline, Rapid industrialization, Environmental sustainability, Safety requirements, Economic development, Hydrocarbons. IoT integration and reservoir analysis in shale production techniques are becoming crucial for optimizing storage and handling operations. The market also faces challenges from geopolitical events, economic circumstances, and variations in crude oil prices, which affect production levels and can lead to financial losses and cash flow issues. As urbanization and industrial expansion continue, the need for efficient and secure systems grows, with companies like Vitol investing in advanced storage terminals and refining units to meet the rising consumption of fuel in the transportation sector and other downstream sectors. The Market plays a critical role in the Energy infrastructure, providing essential services like Tank farms for Crude and Natural gas storage. These facilities are vital for Petroleum logistics and Tanker storage.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2023 and 2028
• Precise estimation of the size of the market growth and trends and its contribution to the market in focus on the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Market growth and forecasting across North America, Middle East and Africa, APAC, Europe, and South America
• A thorough market analysis and report of the market’s competitive landscape and detailed information about companies
• Comprehensive market report analysis of factors that will challenge the growth of market  companies

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