Vacuum Gas Oil Global Market Report 2024

The vacuum gas oil market has grown strongly in recent years. It will grow from $416.85 billion in 2023 to $442.86 billion in 2024 at a compound annual growth rate (CAGR) of 6.2%. The expansion of refineries, growth in the petroleum industry, changes in crude oil grades, adherence to environmental regulations, and the increasing global demand for energy contributed to the growth in the historic period.

The vacuum gas oil market is expected to see strong growth in the next few years. It will grow to $554.61 billion in 2028 at a compound annual growth rate (CAGR) of 5.8%. Trade dynamics, the demand for refined products in the market, global economic growth, adherence to environmental regulations, and initiatives in energy transition are factors contributing to the growth in the forecast period. Major trends in this period include the optimization of refining margins, the demand for cleaner fuels, the adoption of upgrading technologies, a shift in crude oil blending, and increased focus on residue conversion.

The anticipated growth in the demand for fossil fuels is set to drive the vacuum gas oil market in the foreseeable future. Fossil fuels encompass hydrocarbon-containing materials naturally formed in the earth's crust from the remains of deceased plants and animals, including coal, petroleum, natural gas, oil shale, bitumen, tar sands, and heavy oils. Co-processing bio-oil and vacuum gas oil introduces renewable carbon to fossil fuels, reducing the production cost of biofuels. In June 2022, Eurostat, the Luxembourg-based statistical office of the European Union, reported a 13.7% increase in solid fossil fuels in 2021 compared to the previous year's recorded lowest value of approximately 426.66 million tons, highlighting the growing demand for fossil fuels and, consequently, propelling the vacuum gas oil market.

The anticipated growth in the oil and gas industry is poised to drive the vacuum gas oil market in the coming years. The oil and gas industry involves activities related to the exploration, extraction, refining, transportation, and distribution of petroleum products, natural gas, and related resources. Vacuum gas oil (VGO) holds a crucial role in the oil and gas industry, particularly in the refining process. It acts as a vital intermediate feedstock in refineries, contributing to the production of various valuable petroleum products. According to The U.S. Energy Information Administration (EIA) in 2022, the U.S. crude oil production reached 11,910,622 barrels per day, with Texas leading as the top crude oil-producing state, producing 5,060,000 barrels per day. Consequently, the rising demand for oil and gas is a key driver for the vacuum gas oil market.

The anticipated growth in disposable income is poised to drive the vacuum gas oil market in the future. Disposable income, which represents the total income available for spending and saving after deductions, can influence overall energy consumption trends, impacting the demand for refined products such as gasoline and diesel. For instance, in 2023, Trading Economics reported an increase in disposable income in Japan from 412.82 JPY thousand ($3,014.64) in March 2022 to 463.91 JPY thousand ($3,387.76) in February 2023. Consequently, the rise in disposable income is a significant driver for the vacuum gas oil market.

Technological advancements emerge as a key trend gaining traction in the vacuum gas oil market. Companies within the market are embracing new technologies to maintain their market position. In March 2022, Honeywell, a US-based technology provider for petroleum manufacturers, announced that SPEC Energy DMCC would utilize its various technologies to convert less valuable vacuum gas oil and vacuum filtrate into valuable products such as petrol and alkylate at its refinery. One such technology is the UOP Residue Fluidized Catalytic Cracking Technology, which enhances gasoline yield. Refinery configurations are influenced by market changes, and mild hydrocracking technology enables refiners to convert 20-60% of VGO feeds, producing high-quality cat cracker feedstocks along with a certain quantity of middle distillates.

In September 2022, Neste Corporation, a Finland-based oil refining and marketing company, established a 50/50 joint venture with Marathon Petroleum Corporation to produce renewable diesel. Named Martinez Renewables, the partnership involves Neste contributing a total of $1 billion. The joint venture aims to advance the project's objectives, delivering low-carbon-intensity fuels to support California's climate goals and expanding Neste's footprint in the United States. Marathon Petroleum Corporation is a US-based petroleum refining, marketing, and transportation company that sources agricultural feedstocks to produce renewable diesel.

Major companies operating in the vacuum gas oil market report are TAIF Management Company JSC, Kuwait Petroleum Corporation, Exxon Mobil Corporation, KazMunayGas, Par Pacific Holdings Inc., Shell Plc, Neste Oyj, Vertex Energy Inc., The PJSC Lukoil Oil Company, Honeywell International Inc., Zhejiang Petroleum and Chemical Co. Ltd., PJSC Gazprom, Cenovus Energy Inc., Marathon Oil Company, IRPC Public Company Limited, Chevron Corporation, China National Petroleum Corporation, Eni SpA, Indian Oil Corp. Ltd., Axeon Specialty Products, U.S. Oil & Refining Co., Tatneft, PJSC Rosneft Oil Company, PTT Public Company Limited, S-Oil Corporation, SK Innovation Co. Ltd., Thai Oil Public Company Limited, Valero Energy Corporation, Bharat Petroleum Corporation Limited, Hindustan Petroleum Corporation Limited, Reliance Industries Limited, Abu Dhabi National Oil Company, Bahrain Petroleum Company (Bapco)

North America was the largest region in the vacuum gas oil market in 2023. Asia-Pacific is expected to be the fastest-growing region in the global vacuum gas oil market during the forecast period. The regions covered in the vacuum gas oil market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the vacuum gas oil market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Two primary types of vacuum gas oil are heavy vacuum gas oil and light vacuum gas oil. Heavy vacuum gas oil is a dense and viscous blend of hydrocarbons obtained through the vacuum distillation of residue from the atmospheric distillation of crude oil. It serves as a feedstock for fluid catalytic cracking and plays a role in the production of various petroleum products. Depending on sulfur content, heavy vacuum gas oil is classified into low-sulfur vacuum gas oil and high-sulfur vacuum gas oil, utilized in the production of gasoline, diesel oil/kerosene, and other applications.

The vacuum gas oil market research report provides vacuum gas oil market statistics, including vacuum gas oil industry global market size, regional shares, competitors with a vacuum gas oil market share, detailed vacuum gas oil market segments, market trends and opportunities, and any further data you may need to thrive in the vacuum gas oil industry. This vacuum gas oil market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The vacuum gas oil market consists of sales of medium vacuum gas oil (MVGO) and heavy atmospheric gas oil (HAGO). Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.


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