Press Release: Global Naphtha Market on Steady Growth Path Driven by Petrochemical Industry Demand

The global naphtha market size was USD 282.0 Billion in 2022 and is expected to register a rapid revenue CAGR of 3.8% during the forecast period. The global naphtha market is experiencing significant growth due to rising demand from the petrochemical industry and the increasing need for olefin-rich naphtha. Naphtha is a vital feedstock in petrochemical production, primarily used to manufacture essential chemicals such as ethylene, propylene, and benzene, which are critical components in producing plastics, synthetic rubber, and resins.

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Key Market Drivers: Growing Petrochemical Demand and Urbanization

A substantial portion of the naphtha produced globally is used as a feedstock for petrochemical plants, with demand continuing to rise. Recent developments, such as South Korean company S-Oil Corp's plan to open a petrochemical factory connected to the Shaheen refinery, highlight this trend. The facility will use naphtha to produce over 3 million tons of core petrochemical materials annually, including ethylene and propylene. Operations are expected to commence by 2026, indicating the long-term growth trajectory of the naphtha market.

Additionally, naphtha's role in producing high-octane, low-cost gasoline fuels further drives demand. Rapid urbanization and increasing populations in both developed and developing regions contribute to rising demand for affordable fuels. Naphtha is also widely used in industrial applications, including as a solvent for cleaning agents and in the production of paints, varnishes, and asphalt.

Emerging Technologies and Business Collaborations

Technological advancements are creating new opportunities for naphtha production. For instance, Honeywell UOP's "kerosene uncracking" method, introduced in India, is set to enhance refinery capabilities in producing naphtha from kerosene, boosting naphtha output and meeting rising industrial demand. Such innovations are crucial in ensuring the market's continued expansion.

Challenges: Volatile Oil Prices and Competition from Alternatives

Despite the market's growth potential, volatility in crude oil prices presents a challenge to naphtha producers. Fluctuations in oil prices directly impact naphtha production costs, potentially slowing market growth. Additionally, the rise of alternative fuels such as liquefied petroleum gas (LPG) and natural gas liquids (NGL) offers cheaper substitutes for naphtha in certain applications, which could further restrain market growth.

Market Insights: Heavy Naphtha Segment Leads the Market

The naphtha market is divided into two main types: light naphtha and heavy naphtha. In 2022, the heavy naphtha segment dominated the market due to its essential role in petrochemical production. Heavy naphtha is a key raw material in the manufacturing of products such as plastics, resins, and synthetic rubber. The rising popularity of shale gas as a transport solvent for crude oil, combined with the growing automotive industry's demand for naphtha-based fuels, also contributes to the segment's prominence.

Process and End-Use Insights: Steam Cracking and Petrochemicals

The steam cracking process, used to produce olefins such as ethylene and propylene, is one of the fastest-growing segments in the naphtha market. Steam cracking plays a pivotal role in the production of high-octane gasoline and aromatic compounds. This method is increasingly favored in the food and beverage industry and the chemical sector, further boosting its growth. For example, Saudi Aramco's Ras Tanura refinery, valued at USD 2.6 billion, is undergoing upgrades to enhance steam cracking capabilities and make the plant more environmentally friendly.

Petrochemicals represent the largest end-use segment in the naphtha market, driven by the increasing demand for synthetic materials and plastics. The industry is also benefiting from advancements in refining technologies, which allow for more efficient extraction and processing of petrochemical feedstocks. Environmental regulations are pushing manufacturers to adopt greener and more sustainable chemicals, contributing to ongoing innovation in the sector.

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Naphtha Top Companies and Competitive Landscape

The global naphtha market is fragmented with many large and medium-sized players accounting for majority of market revenue. Major players are deploying various strategies, entering mergers & acquisitions, strategic agreements & contracts, developing, testing, and introducing more effective naphtha products in the market.

Some major players included in the global naphtha market report are:

Alexandria Mineral Oils Company

Bajrang Petrochemicals Pvt Ltd.

Slope Electric Cooperative

Chevron Corporation

China Petrochemical Corporation

SABIC

Exxon Mobil Corporation

BP PLC

Reliance Industries Limited

Shell International B.V.

Indian Oil Corporation Ltd

PAO Novatek

SASOL Limited

LG Chem

Formosa Petrochemical Corporation

Naphtha Latest Industry Updates

In May 2022, BP plc and Clean Planet Energy, a UK-based company that is constructing facilities to transform difficult-to-recycle plastic waste into circular petrochemical feedstocks and Ultra-Low Sulfur Diesel (ULSD), inked a 10-year off take deal. The Teesside facility, which is intended to process 20,000 tons of waste plastics annually into naphtha and ULSD, is Clean Planet Energy's first facility, and under the terms of the new deal, BP is expected to get its output.

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For the purpose of this report, Emergen Research has segmented the global naphtha market on the basis of type, process, sales channel, end-use, and region:

Type Outlook (Revenue, USD Billion; 2019-2032)

Light Naphtha

Heavy Naphtha

Process Outlook (Revenue, USD Billion; 2019-2032)

Naphtha Reforming

Steam Cracking

Gasoline Blending

Others

Sales Channel Outlook (Revenue, USD Billion; 2019-2032)

Direct Sale

Indirect Sale

End-Use Outlook (Revenue, USD Billion; 2019-2032)

Petrochemicals

Aerospace

Agriculture

Paints

Coatings

Others

Regional Outlook (Revenue, USD Billion; 2019-2032)

North America

U.S.

Canada

Europe

Germany

France

UK

Italy

Spain

Benelux

Russia

Rest of Europe

Asia Pacific

China

Japan

South Korea

India

ASEAN Countries

Oceania

Rest of APAC

Latin America

Brazil

Mexico

Rest of LATAM

Middle East & Africa

GCC Countries

Israel

Turkey

South Africa

Rest of Middle East & Africa

Look Over transcripts provided by Emergen Research

Naphtha Market Size@ https://www.emergenresearch.com/industry-report/naphtha-market/market-size

Naphtha Market Share@ https://www.emergenresearch.com/industry-report/naphtha-market/market-share

Naphtha Market Trends@ https://www.emergenresearch.com/industry-report/naphtha-market/market-trends

Naphtha Regional Market Demand@ https://www.emergenresearch.com/industry-report/naphtha-market/regional-market-demand

Naphtha Market Analysis@ https://www.emergenresearch.com/industry-report/naphtha-market/market-analysis

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