Market Overview:
Naphtha market size was worth USD 311.1 Billion in 2021, growing at a CAGR of 3.7% during the forecast period (2022-2030), and the market is estimated to be worth USD 431.3 Billion by 2030.
Naphtha is a highly versatile, flammable, and colorless liquid hydrocarbon with a gasoline odor that has multiple applications. This is extracted through the distillation procedure of substances which includes petroleum, coal tar, shale, and wood. The chemical is utilized in manufacturing industrial cleaning fluids, fuel, and industrial solvents for portable lanterns and stoves due to the insolubility and incompatibility with water and powerful oxidizers. Moreover, other applications of naphtha include fire juggling, and blending dry-cleaning solvents and gasoline. Furthermore, the chemical is used in producing propylene as feedstock chemical, xylene, benzene, butadiene, and ethylene. Also, the growth of advanced furnace materials and distillation columns is creating an optimistic impact on the market of naphtha globally.
Developing nations, like India, recently decreased the custom duty on naphtha transportation which will aid the growth of the market in the forecasted period. Naphtha owns a high demand in the industry of petrochemicals. The chemical is also extensively used as a diluent, solvent, and feedstock in several processes. Naphtha is a commodity in the process of distillation of crude oil and the nations that are not part of the production of crude oil will import commodities like naphtha from oil-producing countries.
Market Dynamics:
Driver
The naphtha market is globally driven by the growing commodity consumption in multiple end-use industries like the construction, plastic, and transportation sectors. Additionally, the increasing demand for gasoline as the olefin-rich material accelerates the growth of the naphtha industry due to the wide usage of blending gasoline-grade fuel. Naphtha is utilized for producing olefins and aromatics like toluene, ethylene, butadiene, propylene, and benzene in the industry of petrochemical. Petroleum naphtha is used as a solvent that can be obtained in several cleaning agents and dry-cleaning industries. Thus, the above-mentioned are the driving factors for the naphtha market growth.
Restraint
Crude oil is the major component of the global market of naphtha. The fluctuation in the cost of crude oil is witnessed as the major restraining factor for the expansion of the market. Furthermore, the increasing demand for natural gas liquid and the availability of feasible alternatives such as LPG hamper the growth of the naphtha market during the forecasted period.
Opportunities
The advancement in the transport and electrical sectors in multiple regions for expanding commerce activities by consumers is expected to increase the demand for naphtha. Moreover, modernization in technology has developed distillation processes and furnace materials. The extension of the chemical industry is boosting naphtha consumption. Furthermore, the growth in new developing markets and collaborations are expected to create favorable opportunities for the market.
COVID-19 Impact:
The naphtha market has been adversely affected by the COVID-19 pandemic. The disruption of the supply chain due to the lockdown imposed by the government has declined construction materials which has affected the demand for naphtha globally. Many construction projects have been halted for a long period of time which led to a decrease in the demand for paints and coating and their additives. This significantly impacted the market demand as naphtha finds primary application in paints and coatings. Furthermore, after the resumed business processes, the overall effect of this pandemic on market is expected to remain moderate.
Naphtha Report Coverage:
| Report Attributes | Report Details |
| Study Timeline | 2016-2030 |
| Market Size in 2030 (USD Billion) | 431.3 Billion |
| CAGR (2022-2030) | 3.7% |
| By Type | Heavy naphtha, Light naphtha |
| By End Use | Chemical, Petrochemical, Fertilizers, Gasoline |
| By Geography | North America, Europe, Asia Pacific, Latin America, the Middle East, and Africa |
| Key Players | Shell, British Petroleum, Chevron, ExxonMobil, CNPC, Total SA, Indian Oil Corp., Novatek, Lotte Chemical Corp, Novachem, SABIC |
Market Segmentation:
By Type
The type segment is bifurcated into heavy naphtha and light naphtha. Light naphtha contributed substantial shares to the market growth in 2021. Light naphtha is used for the manufacturing of plastic. Light naphtha is referred to as a finished commodity that is mainly used as a feedstock of petrochemical. Additionally, light naphtha is utilized in steam crackers for producing ethylene and plastics. Thus, this type of naphtha is an enormously traded product due to its demand for large quantities or volumes. In terms of heavy naphtha, the hydrotreating process of this naphtha type is primarily used to remove the impurities from solvents and is often processed in a catalytic reformer. This heavy naphtha comprises a distillation cut prominently made up of substances almost the same density as gasoline. The high aromatic and naphthenic content in this heavy naphtha allows the substance to be a suitable feed for reforming chemical processes for improved combustion characteristics.
By End-Use
The end-user segment is divided into chemicals, petrochemical, fertilizers, and gasoline. Naphtha is primarily utilized as feedstock for the production of high-octane gasoline substances through the process of catalytic reforming. Moreover, the petrochemical industry and chemical industries are anticipated to contribute the largest share of the market. The promising demand for naphtha as feedstock in the process of producing petrochemicals and chemicals is the major factor that supports segment growth. Further, the increasing plastic demand in electronics, packaging, and construction is anticipated to drive the market growth of naphtha during the forecast period. Energy & fuel were credited for more than 25% of the total revenue share of the market in 2020. Naphtha is also utilized in a few niche end-use segments as a liquid of white petroleum incorporating stoves and camp lanterns. Thus, the surging scope in the above-mentioned applications is projected to drive the demand for naphtha during the forecast period.
By Region
Asia Pacific region has dominated the largest share of the market of naphtha in terms of volume. Asia Pacific emerged as the major exporter of petroleum commodities. Furthermore, the rising population besides growing transport and electrical components consumption is also anticipated to drive market growth. Increasing plastics demand in the automotive and construction industries is also anticipated to propel the market growth in the Asia Pacific region The growth in the manufacturing of polymers especially in nations like Japan, China, and India is anticipated to have an optimistic effect on the naphtha’s demand over the period forecast. Moreover, health problems due to exposure to these chemicals and stringent rules, regulations, and laws of the European Union are anticipated to hamper the growth of the market.
Naphtha Market Competitive Landscape:
The competitive landscape of the market has been examined in the report, besides detailed profiles of the major players in the industry. Furthermore, the surge in Research and Development (R&D), product innovation, multiple business strategies, and application launches have boosted the growth of the market. Key players in the market include-
- Shell
- British Petroleum
- Chevron
- ExxonMobil
- CNPC
- Total SA
- Indian Oil Corp.
- Novatek
- Lotte Chemical Corp
- Novachem
- SABIC
Recent developments
- In July 2019, PDV LLC, an oil and gas producer from Venezuela has announced its program to build small pipelines to maintain the scarcity faced by imported naphtha which has been a hindrance in the production and export of large crude materials.
- In June 2021, Axens alliance Sulzer Chemtech’s GTC Technology, a significant and prominent licensor of operations in petrochemical, to authorize a unique procedure for FCC naphtha processing.
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