Propane Market size was worth USD 82.5 Billion in 2021, registering a CAGR of 4.7% during the forecast period (2022-2030), and the market is anticipated to reach over USD 124.73 Billion by 2030.
Propane is a colorless, compressed petroleum gas whose storage is in liquid form which has no poisonous properties. This gas is largely utilized in the production of fuel using a particular technique. It is extremely flammable and can also be liquefied easily. The decreasing rate of non-renewable resources, like crude oil, and growing environmental issues facilitate the need for research and development in propane in terms of product innovations. The demand for propane gas is increasing across the world due to the consumption of propane for residential purposes like heating and cooking.
Moreover, propane is viable and cost-effective. In the chemical & refinery segment, propane is utilized as an exceptional feedstock to produce multiple compounds and materials, especially raw materials for plastic. The increase in R&D activities in the petrochemical and plastic industries is anticipated to offer lucrative opportunities for the players in the propane market. Moreover, apart from energy, this gas is also used as an intermediate commodity for the manufacturing of ethylene and propylene. In the context of region, residences in North America and Europe region usually have an enormous tank that stores the propane gas in liquid form under high pressure. The average residential purpose tanks have a capacity between 500 and 1,000 gallons of liquid propane. Thus, the surged residential use of propane as cooking fuel accelerate the market demand in major regions.
The rising demand for low-emission sustainable fuel in the transportation and automotive sector is the primary factor driving the market growth. Additionally, the adoption of eco-friendly and convenient gases is propelling the propane market growth. Propane is also receiving traction in the agriculture, commercial and residential segments as the fuel for vehicles as it is a low-cost alternative to petrol. Most of the manufacturers are focusing on balanced manufacturing facilities to increase their efficiency, which strengthens the usage of propane as sustainable alternative.
The fluctuations in crude oil and petroleum prices are directly proportionate to the prices of propane as it is extracted as by-product of crude oil. Additionally, the hazardous impacts of propane at a high concentration is also responsible for creating suffocation among human workers which restrains the demand for the propane. Although the low price of propane might surpass oil, propane does not produce as much heat as oil which would lead to using more propane for getting proper consumer benefits. Additionally, the lack of sufficient infrastructure in retail for the utilization of propane hamper the market growth during the forecast period.
The COVID-19 pandemic had positively affected the propane market statistics, as it is the primary and significant application in the residential segment into LPG cylinders. Due to the presence of the majority of families at home for the largest part of the year, the consumption of LPG cylinders witnessed an increased demand for meeting consumer needs of cooking. Additionally, LPG cylinder consumption has grown in major emerging economies across the globe. For instance, India, the second-largest LPG consumer in the world, had a high demand for propane during COVID-19 as the whole population was under lockdown situations in their homes. According to the Oil Market Statistics, LPG sales in the domestic segment have grown by 10% in the year 2021. Post COVID, the circumstances are expected to return back to normal due to the resumed business and industrial processes.
Propane Report Coverage:
|Report Attributes||Report Details|
|Market Size in 2030 (USD Billion)||124.73 Billion|
|By Source||Natural gas, Refining, and Biomass|
|By Application||Industrial, Residential/Commercial, Agriculture, Transportation, Chemicals, and Refineries|
|By Geography||North America, Europe, Asia Pacific, Latin America, the Middle East, and Africa|
|Key Players||Air Liquide S.A., ExxonMobil, BP, Chevron Corp., Royal Dutch Shell, Total SA, and Sinopec.|
Based on the source type the market is segmented into natural gas, refined propane, and biomass. Propane is extracted from the natural gas streams as it is processed in a natural gas processing facility. Further, it is also produced from renewable sources like biomass. It is also extracted as a by-product of petroleum refining due to its derivation from crude oil distillation, where it is classified from other liquids and hydrocarbon gases. Besides these sources, propane can also be obtained from renewable sources like biomass by a process known as pyrolysis. In this procedure, in the absence of oxygen, biomass is heated to high temperatures, obtaining a combination of gases that have propane.
The application segment is incorporated with industrial, residential/commercial, agriculture, transportation, chemicals, and refineries. The consumption of air conditioners, cooking, heating, drying clothes, fueling fireplaces, and refrigerating food are high in the residential sector. Thus, the residential sector utilizes a huge amount of propane for their utilities which in turn propels the propane market growth. Moreover, the industrial segment uses propane-driven fleet vehicles and forklifts. Furthermore, metal workers utilize propane for cutting torches and other equipment. It is also utilized for vulcanizing and soldering which need an instant heat source. Additionally, in modern times half of the propane is utilized as raw materials for plastic bags, rubber, nylon, and pharmaceuticals. Farmers utilize equipment fueled by propane for pest controlling and operating multiple farm equipment.
The regional segment includes Asia Pacific, Europe, North America, the Middle East, and Africa, Latin America. The fast-paced growth in industrialization and increasing GDP growth rate in developing economies such as China and India are projected to uplift commercial and manufacturing industries. Furthermore, in the year 2020, India had a GDP growth rate greater than 10% which was tremendous. It is also anticipated to surge manufacturing activities throughout the Asia Pacific, creating enormous demand for the downstream processing of chemicals during the forecast period. Europe is also an emerging region and is credited for more than 30% of the total revenue in 2020. The developing nations in this region, especially in eastern parts of Europe, have been noticing strong growth in its economy.
Propane Market Competitive Landscape:
The competitive segment in the market propane has been examined in the report, with, detailed profiles of the major players operating in the industry. Further, the growth in Research and Development (R&D), innovations in products, multiple business strategies, and application launches have fueled the growth of the market. Key players in the market include-
- Air Liquide S.A.
- Chevron Corp.
- Royal Dutch Shell
- Total SA
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