Global Naphtha Market, By Type (Heavy, Light), By Application (Chemical, Energy, Fuel), By Region, and Key Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends and Forecast 2023-2033

Market Overview

The global naphtha market size is expected to be worth around USD 407.8 billion by 2033, from USD 283.6 billion in 2023, growing at a CAGR of 3.7% during the forecast period from 2023 to 2033.

This is because of the rising demand for transportation fuel worldwide. The petrochemical sector will see a rise in demand for hydrocarbon-cracking products.

Note: Actual Numbers Might Vary In Final Report

Key Takeaways

1. Market Growth and Value: The global naphtha market is expected to reach a substantial worth of around USD 407.8 billion by 2033, indicating a significant growth trajectory from USD 283.6 billion in 2023. This growth, at a CAGR of 3.7%, is primarily attributed to the rising demand for transportation fuel globally.
2. Type Analysis: In 2023, light naphtha led the market due to its versatile applications in producing gasoline and various petrochemicals. It held a dominant position, contributing significantly to the market share due to its use in the production of plastics and synthetic rubbers.
3. Applications and Processes: Naphtha serves as a crucial chemical feedstock, accounting for over 63.8% of the total volume share in 2023. It’s extensively used in steam cracking for producing propylene, ethylene, and gasoline. Additionally, it plays a pivotal role in petrochemical steam crackers, producing olefins used in the production of plastics and synthetic rubber.
4. End-Use Segments: Petrochemicals emerged as the primary end-use segment, driving the market with over 51.6% market share in 2023. Naphtha’s role in producing essential petrochemicals like ethylene and propylene significantly contributes to industries such as packaging, construction, and automotive.
5. Market Drivers: The increasing demand for naphtha is attributed to its essential role in petrochemical production, the rise in demand for olefin-rich naphtha for affordable high-octane diesel, and its widespread use as a solvent in various industries, contributing to market expansion.
6. Market Restraints: Challenges faced by the naphtha market include the volatility of crude oil prices affecting naphtha costs, rising demand for natural gas liquids, and the shift towards cheaper alternatives like LPG, impacting the market’s growth.
7. Regional Analysis: The Asia Pacific dominates the naphtha market, accounting for more than 58.4% of the total volume share in 2023, driven by increasing population, electrical and transport equipment use, and growing demand for plastics in the construction and automotive industries.
8. Key Players and Recent Developments: Top players such as Shell, British Petroleum, ExxonMobil, CNPC, and others are contributing significantly to the market’s revenue share. Recent developments, like maintenance shutdowns by LG Chem and strategic agreements by BP and Chevron, impact the market dynamics.
9. Opportunities and Challenges Ahead: Opportunities lie in the growth of the electrical and transport sectors, technological improvements in naphtha production, expanding chemical industries, and entering new markets. Challenges include fluctuating crude oil prices, competition from alternatives like LPG, technological advancements, and market expansions.

Type Analysis

In 2023, Light Naphtha and Heavy Naphtha were the primary segments in the market, holding a strong position by securing over 56.5% of the market share. Light Naphtha, known for its use in producing gasoline and petrochemicals, led the market due to its versatile applications across various industries.

Its demand in petrochemical production, especially in making plastics and synthetic rubbers, contributed significantly to its dominant position.

The global naphtha market can be divided into two types based on type. This report provides data on trade, demand, supply, and differentiation of light and heavy Naphtha. The Heavy Naphtha analysis includes Naphtha that has high aromatic and naphthenic levels.

This is the proper feed for reforming. Light and heavy naphtha prices and balances are often closely related, even though they have different uses.

By Process

The main application segment for Naphtha was as a chemical feedstock. It accounted for over 63.8% of the total volume share in 2023. It is used to steam crack propylene, ethylene, and gasoline. Catalytic reforming is another application that uses it to extract benzene and toluene.

Naphtha, a mainstream chemical that has many uses, is a key ingredient. Naphtha can be used as an industrial solvent to make household cleaners, vapors of lighters, oil painting, and gasoline production, shoe polish ingredients, stain removal, among many other uses. Light Naphtha plays a crucial role in petrochemical steam crackers.

Both aromatics and olefins are produced by cracking. Olefins, which are also used as the primary feedstock in the production of plastics such as polyethylene and propylene, are the main ingredients. Olefins can also be used in other chemical processes such as the production of synthetic rubber and polymers.

Naphtha can also be used to make fuel or as an additive to fuel. Naphtha’s main utility as a fuel is in its Application to industrial and residential heating units, burners, &, power stoves, and cigarette lighters, among other applications. They can also be used to make petrochemicals such as gasoline and butane.

Market growth is expected to be driven by growing plastics demand in construction and packaging. In 2023, more than 32.2% of the total market share for Naphtha was accounted for by energy & fuel. Some niche markets also use Naphtha, such as stoves and camp lanterns. Over the next seven years, growth is expected to be driven by increased demand in the above-mentioned areas.

By End-Use

In 2023, Petrochemicals took the lead in the Naphtha market, holding a dominant position with over 51.6% market share. This segment drives the market due to the widespread use of Naphtha as a feedstock for producing essential petrochemicals like ethylene and propylene.

These chemicals serve as building blocks for various products, especially plastics, contributing significantly to industries such as packaging, construction, and automotive. Agriculture followed with a notable market share, utilizing Naphtha in the production of pesticides and fertilizers, supporting crop cultivation.

Paints & Coatings secured a significant share by employing Naphtha as a solvent in the formulation of paints, coatings, and surface treatments across industries. The Aerospace sector, while smaller in market share, relies on Naphtha as a component in fuels and lubricants for aircraft.

Other industries collectively contribute to the market by utilizing Naphtha in niche applications, showcasing its versatility across diverse sectors. Despite its dominance, the Petrochemicals segment faces competition from other sectors that leverage Naphtha’s multifaceted properties for various industrial purposes.

Note: Actual Numbers Might Vary In Final Report

Маrkеt Ѕеgmеntѕ

By Type

• Heavy
• Light

By Process

• Chemical
• Energy
• Fuel

By End-Use

• Petrochemicals
• Agriculture
• Paints & Coatings
• Aerospace
• Others

Drivers

Naphtha Is a Key Component in Petrochemical Production: Naphtha is an essential ingredient used by petrochemical industries for producing chemicals such as ethylene, toluene, benzene, butadiene and propylene production.

As these industries expand further, so too does their demand for naphtha production and market. This has contributed significantly to market expansion.

Rise in Demand for Olefin-Rich Naphtha: This type of naphtha is mainly used to make affordable high-octane diesel. Because more people need cost-effective fuel due to a growing population and faster urbanization, the use of naphtha for this purpose has increased in both advanced and developing countries, leading to higher demand.

Naphtha as a Solvent: People use petroleum naphtha as a cleaning liquid in various products. It’s found in many cleaning agents and is used to thin out varnish, paints, and asphalt. Dry-cleaning businesses also use naphtha. Due to these uses, demand for naphtha has steadily grown over time, fuelling market expansion.

These drivers demonstrate how naphtha’s demand has been on the rise due to its widespread usage in various petrochemical processes and as an affordable fuel feedstock and solvent in various products and industries. This rise is expected to fuel further expansion in the naphtha market.

Restraints

The naphtha market faces a few challenges. Firstly, since crude oil is a key part of naphtha, the changing and unpredictable costs of getting crude oil can limit the naphtha market’s growth. Additionally, the rising demand for natural gas liquid and the shift towards cheaper alternatives like LPG instead of naphtha might also slow down the growth of the naphtha market.

This report on the naphtha market gives a lot of details about recent developments, trade rules, production analysis, and various factors that affect the market.

Opportunities

The naphtha market has several opportunities ahead. The growth of electrical and transport sectors in many regions due to increased consumer trade activities is expected to boost the demand for naphtha. Technology improvements have made distillation processes better and advanced furnace materials are now available, which can help in making naphtha more efficiently.

The expanding chemical industry is also using more naphtha. Additionally, entering new markets and forming partnerships can drive the market and create more chances for growth. These factors together can create useful opportunities for the naphtha market to grow further.

Challenges

Fluctuating Crude Oil Prices: Since naphtha is closely linked to crude oil, changes in crude oil prices can impact the cost and availability of naphtha. These fluctuations can affect the stability of the naphtha market.

Competition from Alternatives: There’s a shift in preference towards cheaper alternatives like LPG (liquefied petroleum gas) and natural gas liquids instead of naphtha. This competition from other options affects the growth of the naphtha market.

Technological Advancements: While technology improves distillation processes, it also poses challenges. Upgrades in technology require investments and adjustments, which might be challenging for some companies.

Market Expansion and Collaborations: While entering new markets and forming partnerships can be opportunities, they also present challenges. It can be difficult for some companies to adapt to new markets and build effective collaborations.

Regional Analysis

The Asia Pacific naphtha markets dominated global demand in 2023 and accounted for more than 58.4% of the total volume share. The Asia Pacific was the largest exporter of petroleum products in 2023.

Over the forecasted period, product demand will be driven by increasing population and increased use of electrical and transport equipment. Market growth is expected to be fueled by a growing demand for plastics in the construction and automotive industries.

Over the forecast period, the demand for Naphtha is expected to rise due to rising production in emerging economies such as China, India, and Japan. Market growth is expected to be slowed by health concerns about exposure to chemicals as well as strict laws in place in the European Union.

Due to changing laws regarding chemical trade, Europe’s demand for Naphtha is expected to slow down after 2020. The market is showing some promise, however, with rising demand and production from the Asia Pacific.

Note: Actual Numbers Might Vary In Final Report

Кеу Regions and Countries

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Russia
  • Spain
  • Rest of Europe
• APAC
  • China
  • Japan
  • South Korea
  • India
  • Rest of Asia-Pacific
• South America
  • Brazil
  • Argentina
  • Rest of South America
• MEA
  • GCC
  • South Africa
  • Israel
  • Rest of MEA

Key Players Analysis

Global naphtha markets are fragmented. The industry’s top five players, which include Shell, British Petroleum, ExxonMobil, and CNPC, accounted for more than half of the industry’s revenue share in 2023.

Because of their vast distribution network, these companies can dominate the global market. Their long-term relationships with distributors and the acquisition of petrochemical plants are key to their economic growth.

Due to the high dependency on oil and natural gas, companies have been encouraged to work together across the entire value chain. Reliance Industries, Mitsubishi Chemical, and others have combined their crude oil production with end-product manufacturing to improve economies of scale.

Other players in the industry are TotalEnergies SE, Indian Oil Corp., Novatek, and Lotte Chemical Corp. Novachem, SABIC, and Mangalore Refinery & Petrochemicals Limited. These are the top players in global ANPR markets:

Market Key Players

• LG Chem
• China Petrochemical
• Chevron
• Mangalore Refinery and Petrochemicals Limited
• Exxon Mobil Corporation
• Reliance Industries Limited
• BP
• Shell
• SABIC
• British Petroleum
• CNPC
• China Petroleum & Chemical Corporation
• Formosa Petrochemical Corporation
• Saudi Aramco
• Lotte Chemical Corporation

Recent Development

October 2022: LG Chem shuts down its naphtha crackers in South Korea for maintenance for seven weeks. It will affect the supply of petrochemicals in the region during maintenance.

On May 2022, BP plc has signed a 10-year offtake agreement with Clean Planet Energy, a UK-based company that is developing facilities to convert hard-to-recycle waste plastics into circular petrochemical feedstocks and also into ultralow sulphur diesel (ULSD).

On May 2023, Chevron Corp renewed oil operations in Venezuela, that will boost production with the goal of accelerating a plan to recover all of the debt owed by the OPEC member by the end of 2025.

On July 2023, Exxon Mobil Corporation acquired Denbury Inc., an experienced developer of carbon capture, utilization and storage (CCS) solutions and enhanced oil recovery. Under the terms of the agreement, Denbury shareholders will receive 0.84 shares of ExxonMobil for each Denbury share.

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