Vacuum Gas Oil (VGO) belongs to a petroleum hydrocarbon heavy distillate family. VGO is also recognized as cat feed. It is one of the two outputs of vacuum distillation tower. It is a lighter material of the two. The principal use of VGO is in the form of feed in cracking units’ for instance fluid catalytic cracker or hydrocracker. These cracking units upgrade the VOG into products having greater value including gasoline and diesel.
As per study, “Global Vacuum Gas Oil (VGO) Market Status (2015-2019) and Forecast (2020-2024) by Region, Product Type & End-Use” the key companies operating in the global vacuum gas oil market include U.S. Oil & Refining, Axeon, Kuwait Petroleum Corporation, Shell and among others. The global VGO market is highly competitive and comprises of some key players. In terms of the market share, some of the leading players presently dominate the global market. These players are leveraging on the strategic collaborative creativities to strengthening their market share as well as escalation their profitability.
By type, vacuum gas oil market is segmented as Light Vacuum Gas Oil (LVGO) and Heavy Vacuum Gas Oil (HVGO). LVGO is being gradually more utilized for cracking in order to obtain gasoline & diesel. As a result, LVGO segment is expected to grow at higher growth rate during the forecast period. In addition, by application, market is segmented as diesel / kerosene production, gasoline production and others. The gasoline production segment dominates the global market as low sulfur vacuum gas oil makes an excellent feedstock to obtain the gasoline and other high octane components.
The vacuum gas oil market is driven by increase in use of vacuum gas oil to supply bunker fuel, followed by growth in investment in the petroleum sector, and rise in demand for the vacuum gas oil from Asia Pacific countries such as China and India. However, high cost of raw materials and high manufacturing cost may impact the market. Additionally, strong Opportunity in Europe as the largest exporter in the oil and gas industry and growth in oil and gas industry due to rise in demand for oil are leading opportunities for global market. Moreover, increase in investment on Research & Development (R&D) activities is a key trend for market. Furthermore, costly skilled manpower and lack of advanced technology are major challenges for global market.
Based on geography, the North-American region holds major share in global vacuum gas oil market owing to huge automobile volume and presence of the well-developed refining & cracking facilities across the region. The Asian-Pacific and European regions are estimated to witness higher growth rate due to rapid industrialization and growth in per capita energy demand over the forecast period. It is projected that global vacuum gas oil market will be reached at rapid pace as a result of increase in need for high octane gasoline, rise in the production of diesel and growth in sea trade & marine exploration during the forecast period.
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Ankur Gupta, Head Marketing & Communications