The global crude oil flow improvers market size was valued at USD 1.31 billion in 2016. The rising acceptance of hydraulic fracturing and horizontal drilling techniques is projected to drive the demand for these products. The market is also actively driven by the high demand for these specialty products to enhance fluid drift in various stages of the petroleum value chain.
The U.S. was the leading consumer market in North America. North America observed the maximum demand for these products, owing to the upsurge in the implementation of unconventional petroleum extraction techniques, such as hydraulic fracturing and horizontal drilling, the necessity for drift improvement additives to decrease the viscosity of petroleum liquids and to improve the movement through pipes has increased.
U.S. crude oil flow improvers market revenue by product, 2014 - 2025 (USD Million)
The oversupply of crude oil worldwide along with various geopolitical issues have led to the slump in average spot prices globally. The U.S. has made considerable amounts of investments in unconventional forms of drilling. Thus, it cannot afford to cut down their production as it would lead to a decline in the price of the finished products.
Owing to exploration activities, Europe holds huge opportunities for growth. The market is also anticipated to gain profitability from ongoing activities in the Middle East to tap tight reserves, which will improve the declining rate of production.
The product manufacturing companies have high priority for minimizing rig time, improving the overall productivity of oil wells, and ensuring environmental amenability. New joint ventures, acquisitions, and mergers between the existing players in the market are likely to create new opportunities in the global industry.
The regulatory standards play a vital role in this industry. Frequently changing regulatory framework is a matter of concern for the industry players across the entire value chain. Several guidelines need to be followed during the utilization and disposal of these chemicals concerning environmental factors associated with it. This offers guidance to market players regarding the licenses, sanctions, guidelines, or orders to be followed during the utilization of these products.
The paraffin inhibitors was the largest product segment in 2016 and is expected to reach a net worth exceeding USD 620 million by 2025. Paraffin inhibitors are polymers with a high-molecular-weight. They interact with paraffins in the petroleum liquids to restrict the formation of wax crystal, size, shape, and adhesion characteristics. These agents inhibit the paraffin deposition in the system by establishing repulsion between paraffin particles as well as between paraffin particles and the pipe surface.
Asphaltene inhibitors is projected to observe the fastest growth over the prediction period. The segment is expected to grow at a CAGR of 6.3% over the forecast period. The growth in this segment is attributed to its increasing utilization in the upstream and offshore petroleum operations. They are used to maximize the production capacity by inhibiting the blockages in the flow lines. They preserve the integrity of subsea assets like flow lines and wells and manage the throughput time and minimizing down time. The other product categories include scale inhibitors, drag reducing agents, and hydrate inhibitors.
Companies have started focusing on developing low-dose hydrate inhibitors owing to their environmental benefits when compared with glycol or methanol. The advantages associated with the use of these products are that they substantially decrease the need to use other chemical additives along with it. The need for other additives was very prevalent in the case of conventional hydrate inhibitors. This eliminates the risk associated with hydrate plugs and line blockages thereby driving the demand for crude oil flow improving products.
Extraction emerged as the largest and the fastest growing application and accounted for over 42% of the total revenue in 2016. The COFI market is poised to witness growth owing to its capability to maximize the extraction of hydrocarbons in a cost-effective manner and assists in minimizing its influence on the environment. Increasing global hydrocarbon production and hydraulic fracturing operations from eccentric sources are driving the market.
Global crude oil flow improvers market share by application, 2016 (%)
The refinery application segment accounted for over 31% of the total revenue in 2016. The need to protect the integrity of the assets and the increasing refined petroleum products demand such as diesel, gasoline, naphtha, and lube-base stock to steer the product utilization in the refinery sector over the prediction period.
Various stages of petroleum production require the addition of huge quantities of these flow improvers. Some of the major OPEC countries including Saudi Arabia, Iraq, and Iran have amplified their production capacities to sustain the existing market position.
The drag reducing agents are the chemical additives used in the pipelines to minimize the level of turbulence and reduces the possibilities of corrosion. The additive interacts with the fluids and the pipeline walls thereby reducing the contact with the oil and the walls of the pipelines. This enables the crude oil to flow through low-pressure areas in a cost effective and energy efficient manner.
Most of the investments are intended to penetrate the evolving markets in Asia Pacific, Middle East & Africa, and North America. The major multinational companies intend to enhance their global footprints in extremely lucrative regions and exploit factors such as low labor costs and resource availability along with liberal environmental norms.
Asia Pacific crude oil flow improvers industry is the fastest growing market in terms of revenue. The regional market is estimated to grow at a CAGR of over 6% during the forecast period. The growth of the market is specifically attributed to the increasing number of exploration activities in this region.
The Middle East & Africa is poised to grow at moderate rates over the forecast period owing to its constant demand in the upstream sector of this region. There have been various upcoming offshore contracts in this region which will require the utilization of products such as hydrate inhibitors, paraffin inhibitors, and pour point depressants to deal with the fluid flow issues associated with offshore hydrocarbon extraction processes. For this purpose, the COFI market has established a strong-hold and is expected to further grow in this region.
Owing to the removal of sanctions on Iran, various multinational energy companies have shown an inclination towards investing in this region which is offering approximately 50 onshore and offshore projects and around 18 energy and power blocks valued over USD 185 billion by 2025. The existing geopolitical disturbances in countries such as Libya and Nigeria are expected to ease in the years to come. This is likely to result in increased hydrocarbon production and trade from these regions.
Major industry participants include BASF, Halliburton, Schlumberger, Nalco, The Lubrizol Company, Clariant, and Evonik. The global COFI market is extremely competitive owing to the presence of various well-established multinationals who pioneer in the manufacturing and supply of several oilfield chemicals across the industry value chain and have multiple channels for procurement of raw materials and distribution of finished goods globally.
The companies adopt integration across the value chain by supplying raw materials, manufacturing and distributing the finished products which enable these companies to reduce the overall costs of procuring raw materials from small scale firms. Integration across the value chain enables the companies to achieve higher profit margin and achieve optimum economies of scale so as to ensure the sustainability of the products in the industry.
The increasing requirement for flow improvers in operations such as extraction, transportation, and refining has provoked the major players to enhance their product portfolio and global footprint by undertaking mergers and acquisitions to serve a broader industry segment and acquire a larger market share
Base year for estimation
Actual estimates/Historical data
2014 - 2015
2017 - 2025
Revenue in USD Million & CAGR from 2016 to 2025
North America, Europe, Asia Pacific, CSA, MEA
U.S., Canada, Mexico, UK, Russia, Norway, China, India, Indonesia, Brazil, Argentina, Venezuela, Saudi Arabia, UAE, Algeria
Revenue forecast, company share, competitive landscape, growth factors and trends
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Segments covered in the report
This report forecasts revenue growth at global, regional & country levels and provides an analysis of the industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global crude oil flow improvers (COFI) market on the basis of product, application, and region:
Product Outlook (Revenue, USD Million, 2014 - 2025)
Application Outlook (Revenue, USD Million, 2014 - 2025)
Regional Outlook (Revenue, USD Million, 2014 - 2025)
Central & South America (CSA)
Middle East & Africa
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