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The vacuum gas oil market size is forecast to increase by USD 111.59 billion and is estimated to grow at a CAGR of 5.2% between 2023 and 2027. The report includes historic market data from 2017 to 2021. The oil and gas industry is experiencing a surge in refinery upgradation. There is a notable increase in the indirect use of diesel, and the automotive industry is witnessing significant growth.
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The primary trend in the global vacuum gas oil (VGO) market is the rise in refinery upgradation within the oil and gas industry. Refinery operators are actively adopting measures like fluid catalytic cracking (FCC) and hydrocracking to enhance vacuum gas oil yields and improve refining processes. Environmental concerns have also driven companies to focus on producing cleaner and low-sulfur fuels, impacting the vacuum gas oil industry. For instance, BP announced a significant investment in projects to improve refinery efficiency and reduce carbon dioxide emissions, resulting in increased renewable diesel output. Such developments are expected to drive market growth during the forecast period.v
The market share growth by the lower sulphur content segment will be significant during the forecast period. The global VGO market has experienced a significant shift in recent years, with many countries around the world beginning to lower the sulfur content in their products. This is in response to growing concerns about the negative environmental and health effects of sulfur emissions from various industries, including the oil and gas sector.
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The shift towards lower sulfur content is also happening in other industries. For example, many countries are now requiring that diesel fuel be sold with a maximum sulfur content of 10 ppm (parts per million), down from previous limits of up to 500 ppm. This change will lead to cleaner air and improved respiratory health, particularly in urban areas where diesel emissions are a major source of pollution. In addition to regulatory changes, many companies in the oil and gas sector are also voluntarily adopting lower sulfur content in their products. This is driven by a combination of factors, including consumer demand for cleaner energy solutions, environmental concerns, and the potential for long-term cost savings. Thus, the factors mentioned above are expected to drive the growth of the low sulfur content segment in the global VGO market during the forecast period.
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North America is estimated to contribute 35% 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 demand for vacuum gas oil continues to grow due to the increasing demand for petrochemicals, transportation fuels, and other industrial applications. This has resulted in the need for more efficient refining processes and better-quality feedstocks, leading to the emergence of advanced refining technologies. For instance, in March 2023, Exxon Mobil Corp (ExxonMobil) announced the successful startup of its Beaumont refinery expansion project, which adds 250,000 barrels per day of capacity in the US Gulf Coast. This expansion will utilize advanced refining technology to optimize high-value products from crude oil production. Thus, the factors mentioned above are expected to drive the growth of the regional market during the forecast period.
The COVID-19 pandemic had a negative impact on the vacuum gas oil market in North America. However, post the lifting of lockdown restrictions, the major oil refineries resumed their operation in the second half of 2020 due to vaccination drives initiated by the governments. Thus, such factors are expected to drive the growth of the market in focus during the forecast period.
The global vacuum gas oil (VGO) market is driven by an increase in demand for gasoline and diesel. The rise of e-commerce has led to more delivery vehicles on the roads, boosting the need for fuel. Additionally, the construction industry heavily relies on diesel-powered machinery, contributing to the growing demand. Moreover, diesel generators are in demand for backup power systems as electricity needs increase globally. These factors are expected to drive the growth of the VGO market during the forecast period.
The fluctuation of vacuum gas oil (VGO) quality poses a significant challenge to the global VGO market growth. VGO is a crucial feedstock in oil refining, but its varying chemical composition and impurities can impact the yield and quality of final products. Different refining processes and potential sediment and aging issues further contribute to quality fluctuations. These factors may hinder market growth during the forecast period.
The market research 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 report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Vacuum Gas Oil 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.
Abu Dhabi National Oil Co.: The company offers vacuum gas oil for the aviation industry.
The research report also includes detailed analyses of the competitive landscape of the market and information about 15 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 companies as dominant, leading, strong, tentative, and weak.
The vacuum gas oil 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.
Vacuum Gas Oil Market Scope |
|
Report Coverage |
Details |
Page number |
156 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 5.2% |
Market growth 2023-2027 |
$ 111.59 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
4.65 |
Regional analysis |
North America, APAC, Europe, Middle East and Africa, and South America |
Performing market contribution |
North America at 35% |
Key countries |
US, Canada, Saudi Arabia, China, and India |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Abu Dhabi National Oil Co., BP Plc, Chevron Corp., China National Petroleum Corp., Eni SpA, Exxon Mobil Corp., Hess Corp., Indian Oil Corp. Ltd., Kuwait Petroleum Corp., Marathon Petroleum Corp., Occidental Petroleum Corp., Petroleos Mexicanos, Phillips 66, PJSC LUKOIL, Repsol SA, Rosneft Oil Co., Saudi Arabian Oil Co., Shell plc, Sinopec Shanghai Petrochemical Co. Ltd., and TotalEnergies SE |
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, Market condition analysis for 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 Product
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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