Conventional Oil Market Expected to Reach $4690.2 Billion by 2031—Allied Market Research

According to a new report published by Allied Market Research, titled, “Conventional Oil Market," The conventional oil market size was valued at $2.5 trillion in 2021, and is estimated to reach $4690.2 billion by 2031, growing at a CAGR of 6.4% from 2022 to 2031.

Conventional resources are oil concentrations that exist in defined accumulations or pools. These pools are typically located beneath impermeable rock formations with significant porosity and permeability. These impermeable layers constitute barriers to hydrocarbon migration, trapping oil and gas beneath them. Conventional oil pools are created by drilling vertical wells with little stimulation.

Economic growth is one of the most important variables influencing petroleum products and thus conventional oil demand. Energy consumption rises as economies expand, especially when it comes to moving commodities and materials from producers to consumers. The global transportation sector is entirely reliant on conventional oil products such as gasoline and diesel fuel. Many countries also rely significantly on conventional oil fuels for heating, cooking, and generating power. Petroleum products derived from conventional oil and other hydrocarbon liquids account for roughly one-third of total global energy use. All these are factors projected to drive the market growth during the forecast period.

To meet ambitious mid-century goals for net-zero emissions, governments around the world are making policies and planning the decrease in the use of conventional oil for transportation, power generation, and others. More fuel efficiency improvements expanded teleworking and less business travel, considerably higher electric car adoption, new rules to cut oil consumption in the power sector, and enhanced recycling these efforts might limit oil consumption by up to 5.6 million barrels per day by 2026, implying that oil demand will never return to pre-crisis levels. All these are factors projected to hamper the market growth during the forecast period.

The increase in knowledge and the benefits of conventional oil automotive engine oil in automobiles, such as friction reduction and the protection and lubrication of engine parts, are predicted to drive conventional oil demand. Therefore, significant growth in the global automotive sector, along with an increase in vehicle demand, is expected to boost the global conventional oil market growth during the forecast period. These factors are anticipated to create several conventional oil market opportunities for the key players operating in the market in the upcoming years.

The conventional oil market share is segmented on the basis of type, sulfur content, end-user industry, and region. By type, it is classified into light distillate, middle distillates, heavy ends, and others. By sulfur content, it is classified into low sulfur and high sulfur. By end-user industry, it is classified into automotive, chemical, power, industrial, and others. Region wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.

The key players profiled in the conventional oil market analysis report include BP, Chevron, Eni, ExxonMobil, Shell, Total, CNPC, Equinor, Petrobras, and Repsol.

The report offers a comprehensive analysis of the global conventional oil market trends by thoroughly studying different aspects of the market including major segments, market statistics, market dynamics, regional market outlook, investment opportunities, and top players working toward the growth of the market. The report also highlights the present scenario and upcoming trends & developments that are contributing toward the growth of the market. Moreover, restraints and challenges that hold power to obstruct the market growth are also profiled in the report along with Porter’s five forces analysis of the market to elucidate factors such as competitive landscape, bargaining power of buyers and suppliers, threats of new players, and the emergence of substitutes in the market.

Impact of COVID-19 on the Global Conventional Oil Industry

• Sales of conventional oil are directly proportional to the demand from the chemicals, automobiles, and petrochemical industries. However, various sectors such as chemicals and automotive were negatively impacted by the COVID-19 pandemic which has affected the production and demand for conventional oil due to a disrupted supply chain.
• COVID-19 impacted almost all industries and conventional oil-producing companies had to cease their operations owing to import-export restrictions, lockdowns imposed across several countries, shortage of labor the fear of contracting the novel coronavirus led to sluggish demand in the market
• Social distancing norms, closed borders, and production constraints, due to the pandemic, across various countries such as China, India, and the U.S. have affected the global conventional oil market forecast period.

Key Findings of the Study

• Based on type, the middle distillates sub-segment emerged as the global leader in 2021 and the light distillate sub-segment is anticipated to be the fastest growing sub-segment during the forecast period
• Based on sulfur content, the low sulfur sub-segment emerged as the global leader in 2021 and is anticipated to be the fastest growing during the forecast period
• Based on end-user industry segment, the automotive sub-segment emerged as the global leader in 2021 and the power sub-segment is anticipated to be the fastest growing during the conventional oil market  forecast period
• Based on region, the LAMEA market registered the highest market share in the conventional oil market and is projected to maintain its position during the forecast period