Rapidly Increasing Consumption and Distribution of Electricity to Fuel Growth of Transformer Oil Market
The expanding transmission and distribution of energy around the world is one of the primary factors driving the growth of transformer oil market. Electricity consumption is increasing because of growing urbanisation, and industrialisation, particularly in emerging countries with high population density such as India, and China. As a result, governments in these countries are launching steps to provide an uninterrupted power supply and extend the current grid infrastructure, which is influencing the growth of transformer oil market. Furthermore, increased investments in power grid development in industrialised regions such as Europe, and North America is a major growth-inducing driver for transformer oil market.
For instance, because of the BRIC countries' excellent economic performance, and the promotion of electrification, global power consumption has risen to almost 23,000 terawatt-hours. Electricity markets around the world faced unprecedented demand in 2021. Strong economic growth, paired with colder winters and warmer summers, increased worldwide electricity demand by more than 6%, the highest increase since the financial crisis ended in 2010. The number of transformer installations has also increased as electricity demand has expanded across various sectors. Furthermore, the market will be driven by rising investment in the power sector, industrialisation, and shifting trends toward renewable energy sources.
Ease of Availability and High Compatibility of Mineral Oil to Make it Ideal for Transformer Oil Market
During the projection period, the mineral oil segment is estimated to hold the biggest revenue share in transformer oil market, exhibiting fastest rate of growth. Mineral oil is primarily utilised in transformers, reactors, and switchgear for cooling, and insulating. It's also utilised to dissipate heat away from the transformer's internal windings. Mineral oil is further divided into naphthenic and paraffinic oils, and mineral oil is used as the insulating fluid in most existing and new transformers. Mineral oil is further divided into naphthenic and paraffinic oils, and mineral oil is used as the insulating fluid in many existing and new transformers. Mineral oil demand is predicted to increase over the projection period due to its low-cost index, and ease of availability when compared to other transformer oils.
Increased Investments in Electricity to Drive Growth of Asia Pacific Transformer Oil Market
The rising demand for power in highly populated nations such as India, China, and Southeast Asia, the Asia Pacific region is likely to lead the market. In addition, the market will rise due to the expansion of grid infrastructure and increased investments in the power sector. Because of the significant need for transformer oil in power transmission infrastructure, China is likely to lead the Asia Pacific region, followed by India. The demand for transformers will rise as the number of substations rises, boosting the demand for transformer oil in APAC.
In 2019, power energy investments in the Asia Pacific area totalled a little over 48 billion dollars. This was more than quadruple the amount invested in renewable energy in the Asia Pacific area in 2010. Moreover, Asia will lead T&D investment in 2020, accounting for around 44.5 percent of global T&D spending which is predicted to be around US$386 Bn by 2030. Grid reinforcement, replacement of obsolete T&D infrastructure, and grid extension are all covered by this expenditure. Furthermore, T&D investment in the Indian subcontinent is expected to expand at a CAGR of 6.72 percent from 2020 to 2030, signifying a significant growth of the region's electric grid network. Developing economies in the APAC area are investing in the expansion of their T&D systems and grid networks to meet the expected rise in power consumption caused by rapid industrialisation, and urbanisation across the region. Installation of new transformers, and switchgear because of the development of the grid network, and T&D system would increase demand for transformer oil.
Because of the expanding industrialisation and increase in the manufacturing of electrical devices and equipment in countries such as the United States, North America will boost the expansion of transformer oil market. Russia, and Germany remain the largest transformer oil consumers in Europe. Increased electricity consumption, and the construction of new power plants are expected to provide the European market with promising growth potential. Increased demand for energy in Latin America, and the Middle East Africa region, as well as the construction of the necessary infrastructure, will promote the adoption of various types of equipment and, as a result, transformer oil.
Global Transformer Oil Market: Competitive Landscape
In February 2020, Nynas AB has expanded the Middle East distribution of its NYTRO BIO 300X transformer oil, the world's first high-performance biobased transformer hydrocarbon fluid manufactured from renewable sources. The NYTRO BIO 300X is a solution to the problem of keeping transformers cool in the Middle East's hot climate. On the other hand, in January 2020, Ergon International has extended its naphthenic refinery in Vicksburg, Mississippi, which will assist the company position itself while conducting the activity by ensuring the longevity of its systems, and operations.
Few of the players in the transformer oil market include Royal Dutch Shell (Netherlands), Repsol (Spain), Exxon Mobil Corporation (US), Engen Petroleum Limited (South Africa), Nynas AB (Sweden), Sinopec Lubricant Company (China), APAR Industries (India), Cargill, Incorporated. (US), PetroChina Company Limited (China), Savita Oil Technologies Limited (India), Chevron Corporation (US), Petro-Canada (Canada), Gandhar Oil (India), Lubrita (Netherlands), Calumet Specialty Products Partners, L.P. (US), Phillips 66 Company (US), Gulf Oil International (UK), Dow (US), Hydrodec Group plc (UK), M&I Materials Limited (UK), Sasol (South Africa), Hyrax Oil Sdn Bhd. (Malaysia), San Joaquin Refining Co, (US), Valvoline Cummins (India), and Ergon, Inc. (US).
Global Transformer Oil Market is Segmented as Below:
By Oil Type
Key Elements Included In The Study: Global Transformer Oil Market
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