"Actionable Insights to Fuel Your Growth"

Propane Market Size, Share & Industry Analysis, By Grade (HD-5, HD-10, Commercial), By End-user (Residential, Commercial, Industrial, and Others), and Regional Forecast, 2024-2032

Region : Global | Format: PDF | Report ID: FBI100586

 

KEY MARKET INSIGHTS

The global propane market size was valued at USD 98.50 billion in 2023. The market is projected to be worth USD 109.77 billion in 2024 and reach USD 278.60 billion by 2032, exhibiting a CAGR of 12.3% during the forecast period.


This gas is a by-product of Natural Gas (NG) processing and crude oil refining. The liquid components recovered during NG processing include ethane, methane, propane, butane, and heavy hydrocarbons. Liquid components recovered during oil refining include propane, butane, and other gases.


This gas, also known as Liquefied Petroleum Gas (LPG), is an odorless hydrocarbon gas at normal pressures and temperatures. It is used for residential heating, cooking, and grills. The gas is marketed and sold exclusively for use in motor vehicles and is sometimes branded as autogas to reflect that it is measured, taxed, and dispensed as a fuel. However, it is virtually identical to conventional gas. When pressurized in a tank to 150 pounds per square inch, it becomes a liquid with an energy density 270 times greater than its gaseous form.


The gas industry faced challenges due to reduced industrial and commercial activity during the COVID-19 pandemic owing to lockdowns and economic slowdowns. The global LPG supply and demand had been growing steadily at more than 3% per year during the pre-pandemic decade of 2010-19 before being brought to a sudden halt in 2020 when the pandemic hit. However, there was a revival in the industry’s growth in 2022, exceeding the demand recorded in 2020, as restrictions were eased. The global consumption rose by 3.7% to 332 million tons in 2021 and by 2% from 2019, according to the latest Statistical Review of Global LPG prepared by Argus on behalf of the World LPG Association.


Propane Market Trends


Increasing Focus on Energy Efficiency and Clean Burning Fuel to Create Market Opportunities


The gas is often called a clean-burning fuel with low carbon emissions compared to other fossil fuels, such as coal and oil. Furthermore, it is an energy-efficient fuel that can help businesses and consumers save money on energy bills. Therefore, the increasing focus on energy-efficient, clean burning will create opportunities for this gas in several residential, commercial, and industrial sectors.


Nitrogen oxides harm the human respiratory tract. Additionally, it can also form acid rain and affect the environment. Vehicles that generally run on diesel fuel emit more carbon when compared to propane-based vehicles. For example, propane-powered vehicles emit 96% less when compared to nitrogen oxide gas-powered vehicles.


As per the U.S. Department of Energy, an increase of more than 1,200% has been recorded in propane gas production within 10 years. Alongside this production, the growth has created extensive opportunities for careers in the gas industry in production, transportation industry, and retail sales and delivery.


Request a Free sample to learn more about this report.


Propane Market Growth Factors


Adoption of Propane in Recreational Vehicles to Reduce Carbon Footprint to Drive the Market Growth


Autogas vehicles, which produce 90% fewer particulates and 20% lesser CO2 than petrol vehicles, provide drivers with a cleaner and more affordable option. For instance, the global autogas consumption stood at around 2.63 million metric tons in 2023. Propane-powered vehicles have steadily grown over the last two decades as low-emission cost-effective alternative fuels.



  • Globally, the number of vehicles that rely on propane autogas has increased from 15 million in 2010 to over 28 million in 2022.

  • In Europe, LPG as a fuel type accounted for 2.5% of the 246 million passenger cars on the road. More than 60,000 vehicles in the U.S. are powered by this gas. The majority of them are truck fleets and school buses. India had around 2.5 million LPG vehicles on the road in 2021.


The growth in propane-powered vehicles is also being driven by regulatory support and incentives provided for clean-fuel vehicles. For example, in December 2023, the U.S. Department of Energy (DOE) provided grants for transport decarbonization research projects prioritizing the use of alternative fuels in commercial off-road vehicle technologies, including natural gas, hydrogen, and renewable propane. Although electric vehicles have taken center stage in reducing carbon emissions, this gas will continue to be considered a clean, alternate fuel. Furthermore, the adoption of propane in recreational vehicles will be driven by the growing prices of conventional fuel and the regulatory support provided by various governments, thereby fueling the propane market growth.


Steady Growth in LPG Supply and Demand Globally to Drive the Market Growth


The global LPG sales volume has grown from 240 million tons in 2009 to 317 million tons in 2022, driven primarily by the growing demand in India and China.



  • China and India accounted for roughly 32% of the global LPG demand in 2022.

  • The China demand stood at 71 million tons in 2022.

  • The cooking fuel market has driven the growth in India’s consumption of LPG, which is around 19-20 kg per capita.


The global production of LPG was around 332 million tons in 2022, with the U.S. accounting for 27%. The U.S. and China, top two LPG producers worldwide, saw a 4.3% and 7.4% growth in production in 2021.


The coverage of LPG in India is also quite widespread and covers 99.4% of the country. LPG is transported to customers via cylinders or tank trucks. There are more than 25,000 LPG distributors in the country. Hence, the government is promoting LPG as an industrial fuel and intends to increase this to 20% by 2030.


RESTRAINING FACTORS


Availability of Alternatives Such as Bio-propane May Hinder the Market Growth


Bio-propane, or bioLPG, is a by-product of Hydrotreated Vegetable Oil (HVO) production that represents about 5% yield on a volume basis. Once purified, bioLPG becomes chemically identical to conventional propane. However, it can reduce CO2 emissions by up to 80%, depending on the feedstock used. Bio-propane output is significantly lower from HVO production from high fatty acid feedstocks, such as Palm Fatty Acid Distillate (PFAD) and tall oil, compared to low fatty acid feedstocks such as virgin vegetable oils or animal fats. Renewable propane is an alternative fuel made from non-petroleum feedstocks, such as natural fats, vegetable oils, and various types of grease. It is chemically identical to conventional propane and can be used as a drop-in replacement fuel in all propane applications.


The global bioLPG production was around 368 million liters (97.2 million gallons) in 2020. This is expected to grow as the total HVO and SAF-grade HEFA production could expand to up to 900 million liters (237.7 million gallons) in 2030 and about 1.4 billion liters (370 million gallons) in 2040. The carbon intensity scores for bioLPG are about the same as the CI scores for the HVO produced in the same batch, determined mainly by which feedstock is used.


Propane Market Segmentation Analysis


By Grade Analysis


HD-5 Grade Segment Holds Dominant Market Share Owing to its Pure Form Majorly Used in Transport Industry


Based on grade, the market is trifurcated into HD-5, HD-10, and commercial.


HD-5 is the dominating grade type for the market. HD-5 grade propane is “consumer grade”. HD-5 means that the propane is in its purest form and is suitable for engine fuel use. HD-5 specification depends on acceptable contents. For example, 99% propane and 1% propylene is HD-5 grade propane, the same as 95% propane and 5% propylene. It is the highest quality propane available to the public and is suggested for use with internal combustion engine fuel.


HD-10 grade propane allows up to 10% propylene in the propylene mixture and still has a propane label. The propane has lower-purity grade and is typically used in industrial applications such as forklift fuel, heating, and drying processes. This segment is expected to experience steady growth during the forecast period due to its lower cost compared to HD-5 propane.


By End-user Analysis


To know how our report can help streamline your business, Speak to Analyst


Residential Segment Holds Major Share as it is Widely Used in Cooking, Heating, and Home Appliances


By end-user, the market is broadly categorized into residential, commercial, industrial, and others. The residential segment holds the dominant market share due to its extensive range of use as a heating fuel in the residential sector. This gas is primarily used in water heating, cooking, refrigerating, clothes drying, powering farms, and industrial equipment. Furthermore, many home appliances, including water heaters, refrigerators, and freezers, use this gas as the primary energy source.


Compared to the residential sector, this gas is used in the commercial sector in much smaller quantities. This gas is also used as a fuel for forklifts and equipment in construction, factories, and warehouses. This application is included in the commercial and industrial sector consumption, depending on the type of business.


REGIONAL INSIGHTS


Asia Pacific Propane Market Size, 2023 (USD Billion)

To get more information on the regional analysis of this market, Request a Free sample


By region, the market has been studied across North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa. Asia Pacific is expected to dominate the propane market share due to numerous factors such as rapidly growing population and increasing urbanization in major countries such as China, India, and other countries with increased demand. With its diverse applications and versatility, this gas meets the growing energy needs, including residential, commercial, and agricultural sectors.


North America is the second largest region to hold a significant market share. The propane consumption is closely related to the cold temperature in the U.S. There is high demand for heating and maintaining the average temperature in winter. It is used in the residential sector as well as commercial sectors. For the residential sector, the consumption of this gas is the highest in winter, primarily for space heating, and generally occurs in non-urban areas where other heating fuels (electricity, heating oil, natural gas, and wood fuels) are limited or expensive.


List of Key Companies in Propane Market


Umicore to Bolster its Presence through Organic & Inorganic Expansion Strategies


The global market is considerably fragmented, with various players operating at the national, regional, and global levels. The market participants are significantly focusing on developing high performance with enhanced operational characteristics to fortify their foothold in the industry.


Natural gas processing and crude petroleum refining in ExxonMobil Corporation have a dominant market share among other companies. The company stated that its sales majorly came from the U.S. and held a share of more than 35% of its overall sale.


Other key industry participants include Royal Dutch Shell plc, BP Plc, Chevron, Sinopec, and other small, medium, and large players. These organizations continually focus on expanding their product/service portfolio and reach across the market.


LIST OF KEY COMPANIES PROFILED:



  • BP Plc (U.K.)

  • Chevron Corporation (U.S.)

  • Royal Dutch Shell Plc (U.K.)

  • Exxon Mobil Corporation (U.S.)

  • ConocoPhillips (U.S)

  • Reliance Industries Ltd. (India)

  • PetroChina Company Limited (China)

  • Sinopec (China)

  • Total S A (France)

  • Ferrellgas Partners L.P.  (U.S.)


KEY INDUSTRY DEVELOPMENTS:



  • November 2023 - State-run oil and gas giants, Bharat Petroleum Corporation (BPCL) and Gas Authority of India (GAIL) signed a 15-year contract for the supply of propane, a critical petrochemical feedstock. The propane will be supplied to GAIL’s propane dehydrogenation (PDH)-polypropylene (PP) project in Usar, Maharashtra.

  • February 2023 - Shell completed the acquisition of Nature Energy, a Renewable Natural Gas (RNG) producer from agricultural, industrial, and household waste. This acquisition, announced in November 2022, would increase Shell's ability to help customers decarbonize and accelerate its transition to net-zero emissions.

  • December 2022 - BP completed the acquisition of Archaea Energy Inc., a leader in Renewable Natural Gas (RNG), marking a milestone in the growth of BP's strategic bioenergy business. The deal would help expand BP's presence in the U.S. biogas industry, improving its ability to support its customers' decarbonization goals. Furthermore, it would help BP in moving closer to reducing the average life cycle carbon intensity of the energy products it sells.

  • November 2022 - ConocoPhillips and TotalEnergies completed the joint acquisition of Hess Libya Waha Ltd., which increased these companies interest in the Waha Concession by 4.1% to 20.4%.

  • September 2022 - BP announced that it completed the acquisition of EDF Energy Services, expanding BP’s presence in the U.S. Commercial & Industrial (C&I) retail power and gas business. The acquisition would offer new opportunities for improved integrated lower-carbon energy solutions for customers through integration (C&I) with other BP businesses and capabilities that can support decarbonization goals.


REPORT COVERAGE


The research and business intelligence report offers an in-depth analysis of the market. It further provides details on the adoption of propane across several regions. Information on trends, drivers, opportunities, threats, and restraints of the market can further help stakeholders gain valuable insights into the market. The report offers a detailed competitive landscape by presenting information on key players along with their strategies in the market.


To gain extensive insights into the market, Request for Customization


Report Scope & Segmentation
















































ATTRIBUTE



DETAILS



Study Period



2019-2032



Base Year



2023



Estimated Year



2024



Forecast Period



2024-2032



Historical Period



2019-2022



Growth Rate



CAGR of 12.3% from 2024 to 2032



 Unit



Value (USD Billion)



 


Segmentation



By Grade



  • HD – 5

  • HD – 10

  • Commercial



By End-user



  • Residential

  • Commercial

  • Industrial

  • Others



By Region



  • North America (By Grade, End-user, and Country)

    • U.S.

    • Canada



  • Europe (By Grade, End-user, and Country)

    • Russia

    • Germany

    • France

    • Italy

    • U.K.

    • Rest of the Europe



  • Asia Pacific (By Grade, End-user, and Country)

    • China

    • India

    • Japan

    • South Korea

    • Australia

    • Rest of Asia Pacific



  • Latin America (By Grade, End-user, and Country)

    • Brazil

    • Mexico

    • Rest of Latin America



  • Middle East & Africa (By Grade, End-user, and Country)

    • Saudi Arabia

    • Turkey

    • Rest of Middle East & Africa








Frequently Asked Questions

A study by Fortune Business Insights states that the global market was valued at USD 98.50 billion in 2023.

The global market is projected to record a CAGR of 12.3% over the forecast period.

The Asia Pacific market value stood at USD 43.70 billion in 2023.

Based on end-user, the residential segment holds a dominating share in the global market.

The global market value is expected to reach USD 278.60 billion by 2032.

The rising adoption of propane in recreational vehicles to reduce carbon footprint is likely to drive the market growth over the study period.

Exxon Mobil Corporation and Royal Dutch Shell Plc. are some of the top players actively operating across the market.

Seeking Comprehensive Intelligence on Different Markets?
Get in Touch with Our Experts

Speak to an Expert
  • Apr, 2024
  • 2023
  • 2019-2022
  • 167

Personalize this Research

  • Granular Research on Specified Regions or Segments
  • Companies Profiled based on User Requirement
  • Broader Insights Pertaining to a Specific Segment or Region
  • Breaking Down Competitive Landscape as per Your Requirement
  • Other Specific Requirement on Customization
Request Customization Banner

Client Testimonials

“This report is really well done and we really appreciate it! Again, I may have questions as we dig in deeper. Thanks again for some really good work.”

- U.S.-based biotechnology company focussing on treatment of chronic pain.

“Kudos to your team. Thank you very much for your support and agility to answer our questions.”

- Europe-based provider of solutions to automate data centre operations.

“We appreciate you and your team taking out time to share the report and data file with us, and we are grateful for the flexibility provided to modify the document as per request. This does help us in our business decision making. We would be pleased to work with you again, and hope to continue our business relationship long into the future.”

- India-based manufacturer of industrial and specialty intermediates with a strong global presence.

“I want to first congratulate you on the great work done on the Medical Platforms project. Thank you so much for all your efforts.”

- One of the largest cosmetics company in the world.

“Thank you very much. I really appreciate the work your team has done. I feel very comfortable recommending your services to some of the other startups that I’m working with, and will likely establish a good long partnership with you.”

- U.S. based startup operating in the cultivated meat market.

“We received the below report on the U.S. market from you. We were very satisfied with the report.”

- Global hearing aids manufacturer.

“I just finished my first pass-through of the report. Great work! Thank you!”

- U.S. based solar racking solutions provider.

“Thanks again for the great work on our last partnership. We are ramping up a new project to understand the imaging and imaging service and distribution market in the U.S.”

- World’s leading advisory firm.

“We feel positive about the results. Based on the presented results, we will do strategic review of this new information and might commission a detailed study on some of the modules included in the report after end of the year. Overall we are very satisfied and please pass on the praise to the team. Thank you for the co-operation!”

- Germany based machine construction company.

“Thank you very much for the very good report. I have another requirement on cutting tools, paper crafts and decorative items.”

- Japanese manufacturing company of stationery products.

“We are happy with the professionalism of your in-house research team as well as the quality of your research reports. Looking forward to work together on similar projects”

- One of the Leading Food Companies in Germany

“We appreciate the teamwork and efficiency for such an exhaustive and comprehensive report. The data offered to us was exactly what we were looking for. Thank you!”

- Intuitive Surgical

“I recommend Fortune Business Insights for their honesty and flexibility. Not only that they were very responsive and dealt with all my questions very quickly but they also responded honestly and flexibly to the detailed requests from us in preparing the research report. We value them as a research company worthy of building long-term relationships.”

- Major Food Company in Japan

“Well done Fortune Business Insights! The report covered all the points and was very detailed. Looking forward to work together in the future”

- Ziering Medical

“It has been a delightful experience working with you guys. Thank you Fortune Business Insights for your efforts and prompt response”

- Major Manufacturer of Precision Machine Parts in India

“I had a great experience working with Fortune Business Insights. The report was very accurate and as per my requirements. Very satisfied with the overall report as it has helped me to build strategies for my business”

- Hewlett-Packard

“This is regarding the recent report I bought from Fortune Business insights. Remarkable job and great efforts by your research team. I would also like to thank the back end team for offering a continuous support and stitching together a report that is so comprehensive and exhaustive”

- Global Management Consulting Firm

“Please pass on our sincere thanks to the whole team at Fortune Business Insights. This is a very good piece of work and will be very helpful to us going forward. We know where we will be getting business intelligence from in the future.”

- UK-based Start-up in the Medical Devices Sector

“Thank you for sending the market report and data. It looks quite comprehensive and the data is exactly what I was looking for. I appreciate the timeliness and responsiveness of you and your team.”

- One of the Largest Companies in the Defence Industry
We use cookies to enhance your experience. By continuing to visit this site you agree to our use of cookies . Privacy.
X