Vacuum Gas Oil Market: Current Analysis and Forecast (2024-2032)
Emphasis on Product (Light Vacuum Gas Oil (LVGO) and Heavy Vacuum Gas Oil (HVGO)); Sulfur Content (Low Sulfur Vacuum Gas Oil and High Sulfur Vacuum Gas Oil); Application (Gasoline Production and Diesel Oil Production); and Region/Country
Vacuum Gas Oil Market Size & Forecast
The Vacuum Gas Oil market was valued at approximately USD 1.16 Billion in 2023 and is expected to grow at a robust CAGR of around 5.40% during the forecast period (2024-2032) owing to the increasing global demand for oil and gas.
Vacuum Gas Oil Market Analysis
Vacuum gas oil (VGO) is a feedstock category used in many sectors, mainly the refinery sector, which manufactures many petroleum products. The second type is derived from the vacuum distillation process; the process follows the initial process of atmospheric distillation towers and partial refining of crude oil. VGO is a general mix of hydrocarbons in the mid-range of the boiling point, which can include light products such as diesel and higher boiling point components that may be refined to heavier products such as gasoline.
The global vacuum gas oil (VGO) market is driven by several factors, among which the rising demand for transportation fuel, the expanding petrochemical sector, and technological enhancements in the refining sector take the limelight. This is because as economies grow and become industrialized, there is an expansion in demand for diesel, jet fuel, and gasoline, which are all derivable from VGO. Further, in the petrochemical industry, VGO is used as a raw material for manufacturing chemicals used in plastic production, thus increasing its demand. Technological factors that affect the refining processes and the conversion process of VGO into high-value products are also areas that have favored the expansion of the market. For instance, in 2021, ExxonMobil planned to invest more than USD 1 billion to convert its existing delayed coker into a hydrocracker unit. This conversion would enable the refinery to process lower-value products like VGO into higher-value diesel and marine fuels. The investment was part of ExxonMobil’s strategy to optimize its refining portfolio and enhance the production of cleaner, higher-value products in response to evolving market demand and regulatory requirements.
Vacuum Gas Oil Market Trends
This section discusses the key market trends influencing the vacuum gas oil market segments as identified by our research experts.
Product Transforming Industry
The light vacuum gas oil is expected to grow with a significant CAGR in the forecast period (2024-2032) due to the growing demand for gasoline and diesel, burgeoning in the global petrochemical industry, and refinancing technologies. This is a highly preferable feedstock for the manufacturing of gas and diesel to cater to the ever-increasing transport requirements worldwide. Furthermore, LVGO is used in the petrochemical industry as a building block to manufacture chemicals and plastics, increasing its consumption. Fluctuations in the price of crude oil and growing technologies and techniques in the refining business to improve product value from LVGO have contributed to market growth. Further, the investment by the companies to build the market, particularly in the Asia Pacific region, also fuels market growth.
North America is Expected to Grow with Significant CAGR During Forecast Period
North America holds the most significant market share in the market. The growth of vacuum gas oil in North America is driven by several key factors. The growing adoption of vacuum gas oil (VGO) in North America is driven by increasing demand for refined petroleum products such as gasoline, diesel, and jet fuel. Refineries in the region are investing in advanced processing technologies to convert VGO into higher-value products efficiently. This trend is fueled by regulatory pressures to produce cleaner fuels and the need to optimize refining operations to meet market demand.
Vacuum Gas Oil Industry Overview
The vacuum gas oil market is competitive, with several global and international market players. The key players are adopting different growth strategies to enhance their market presence, such as partnerships, agreements, collaborations, new product launches, geographical expansions, and mergers and acquisitions. Some of the major players operating in the market are LUKOIL, TAIF-NK, JSC National Company, Par Pacific Holdings, Inc, Neste, Vertex Energy, Honeywell International Inc., Gazprom International Limited, KUWAIT PETROLEUM CORPORATION, and China Yuanda Valve Group Co., Ltd
Vacuum Gas Oil Market News
In 2020, Sinopec announced plans to invest approximately USD 6.8 billion to build a new refining and petrochemical complex in Zhanjiang, Guangdong province.
In 2021, Marathon announced a USD 1.2 billion upgrade to its Garyville refinery in Louisiana, focusing on enhancing its hydrocracking capabilities to process more VGO into ultra-low sulfur diesel and other high-value products. This investment reflects the strategic moves by North American refineries to leverage VGO to produce cleaner and more efficient fuels.
Vacuum Gas Oil Market Report Coverage
Reasons to buy this report:
- The study includes market sizing and forecasting analysis validated by authenticated key industry experts.
- The report presents a quick review of overall industry performance at one glance.
- The report covers an in-depth analysis of prominent industry peers with a primary focus on key business financials, product portfolios, expansion strategies, and recent developments.
- Detailed examination of drivers, restraints, key trends, and opportunities prevailing in the industry.
- The study comprehensively covers the market across different segments.
- Deep dive regional level analysis of the industry.
Customization Options:
The global vacuum gas oil market can further be customized as per the requirement or any other market segment. Besides this, UMI understands that you may have your own business needs; hence, feel free to connect with us to get a report that completely suits your requirements.
Table of Contents
Research Methodology for the Vacuum Gas Oil Market Analysis (2022-2032)
Analyzing the historical market, estimating the current market, and forecasting the future market of the global Vacuum Gas Oil market were the three major steps undertaken to create and analyze the adoption of Vacuum Gas Oil in major regions globally. Exhaustive secondary research was conducted to collect the historical market numbers and estimate the current market size. Secondly, numerous findings and assumptions were taken into consideration to validate these insights. Moreover, exhaustive primary interviews were also conducted, with industry experts across the value chain of the global Vacuum Gas Oil market. Post assumption and validation of market numbers through primary interviews, we employed a top-down/bottom-up approach to forecasting the complete market size. Thereafter, market breakdown and data triangulation methods were adopted to estimate and analyze the market size of segments and sub-segments of the industry. Detailed methodology is explained below:
Analysis of Historical Market Size
Step 1: In-Depth Study of Secondary Sources:
Detail secondary study was conducted to obtain the historical market size of the Vacuum Gas Oil market through company internal sources such as annual reports & financial statements, performance presentations, press releases, etc., and external sources including journals, news & articles, government publications, competitor publications, sector reports, third-party database, and other credible publications.
Step 2: Market Segmentation:
After obtaining the historical market size of the vacuum gas oil market, we conducted a detailed secondary analysis to gather historical market insights and share for different segments & sub-segments for major regions. Major segments are included in the report, such as product, sulfur content, application, and regions. Further country-level analyses were conducted to evaluate the overall adoption of testing models in that region.
Step 3: Factor Analysis:
After acquiring the historical market size of different segments and sub-segments, we conducted a detailed factor analysis to estimate the current market size of the Vacuum Gas Oil market. Further, we conducted factor analysis using dependent and independent variables such as product, sulfur content, application, and vacuum gas oil market regions. A thorough analysis was conducted for demand and supply-side scenarios considering top partnerships, mergers and acquisitions, business expansion, and product launches in the Vacuum Gas Oil market sector across the globe.
Current Market Size Estimate & Forecast
Current Market Sizing: Based on actionable insights from the above three steps, we arrived at the current market size, key players in the global Vacuum Gas Oil market, and market shares of the segments. All the required percentage shares split and market breakdowns were determined using the above-mentioned secondary approach and were verified through primary interviews.
Estimation & Forecasting: For market estimation and forecast, weights were assigned to different factors including drivers & trends, restraints, and opportunities available for the stakeholders. After analyzing these factors, relevant forecasting techniques i.e., the top-down/bottom-up approach were applied to arrive at the market forecast for 2032 for different segments and sub-segments across the major markets globally. The research methodology adopted to estimate the market size encompasses:
- The industry’s market size, in terms of revenue (USD) and the adoption rate of the vacuum gas oil market across the major markets domestically
- All percentage shares, splits, and breakdowns of market segments and sub-segments
- Key players in the global vacuum gas oil market in terms of products offered. Also, the growth strategies adopted by these players to compete in the fast-growing market
Market Size and Share Validation
Primary Research: In-depth interviews were conducted with the Key Opinion Leaders (KOLs), including Top Level Executives (CXO/VPs, Sales Head, Marketing Head, Operational Head, Regional Head, Country Head, etc.) across major regions. Primary research findings were then summarized, and statistical analysis was performed to prove the stated hypothesis. Inputs from primary research were consolidated with secondary findings, hence turning information into actionable insights.
Split of Primary Participants in Different Regions
Market Engineering
The data triangulation technique was employed to complete the overall market estimation and to arrive at precise statistical numbers for each segment and sub-segment of the global vacuum gas oil market. Data was split into several segments and sub-segments after studying various parameters and trends in the product, sulfur content, application, and regions of the global Vacuum Gas Oil market.
The main objective of the Global Vacuum Gas Oil Market Study
The current & future market trends of the global vacuum gas oil market were pinpointed in the study. Investors can gain strategic insights to base their discretion for investments on the qualitative and quantitative analysis performed in the study. Current and future market trends determined the overall attractiveness of the market at a regional level, providing a platform for the industrial participant to exploit the untapped market to benefit from a first-mover advantage. Other quantitative goals of the studies include:
- Analyze the current and forecast market size of the Vacuum Gas Oil market in terms of value (USD). Also, analyze the current and forecast market size of different segments and sub-segments.
- Segments in the study include areas of product, sulfur content, application, and regions.
- Define and analyze the regulatory framework for the Vacuum Gas Oil
- Analyze the value chain involved with the presence of various intermediaries, along with analyzing customer and competitor behaviors of the industry.
- Analyze the current and forecast market size of the Vacuum Gas Oil market for the major region.
- Major countries of regions studied in the report include Asia Pacific, Europe, North America, and the Rest of the World
- Company profiles of the Vacuum Gas Oil market and the growth strategies adopted by the market players to sustain in the fast-growing market.
- Deep dive regional level analysis of the industry
Frequently Asked Questions FAQs
Q1: What is the global vacuum gas oil market's current size and growth potential?
Q2: What are the driving factors for the growth of the global vacuum gas oil market?
Q3: Which segment has the largest share of the global vacuum gas oil market by product?
Q4: What are the emerging technologies and trends in the global vacuum gas oil market?
Q5: Which region will dominate the global vacuum gas oil market?
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