Waste Oil Market Size Forecast to Reach $96.4 Billion by 2027
Research Reports
Apr 15, 2022
The Waste Oil Market size is forecast to reach US$96.4 billion by 2027 after growing at a CAGR of 5.4% during 2022-2027. Waste oil refers to any oil that is used or has been contaminated and can no longer perform its intended use. A wide variety of waste oils such as transmission oils, hydraulic oils, lubricating oils, and fuel oils are generated through various industrial and manufacturing processes. These waste oils are later collected and processed to produce lubricants such as engine oils, lubricating greases, and machine oils for automotive and industrial applications. The automotive sector is booming globally with increasing activities of high vehicle production and sales and this is expected to influence the growth of the market during the forecast period. For instance, according to the stats by European Automobile Manufacturers Association, passenger car registrations increased by 25.2% in the European region in the first half of 2021. Furthermore, the demand for re-refining application of waste oils is increasing in the market as re-refining restores used oil to new oil by eliminating heavy metals, dirt, and chemical impurities, reducing environmental hazards to a great extent. The growing demand for re-refining applications is projected to drive the market’s growth during the forecast period. For instance, as per the 2022 journal by Science Direct, re-refining of waste oil is a suitable option in conserving resources and creating a pollution-free environment. Vacuum distillation technology is projected to witness the highest demand during the forecast period. The strict regulations regarding waste oil management might hamper the market’s growth during the forecast period.
COVID-19 Impact
The waste oil market was deeply affected due to the COVID-19 pandemic. Challenges in the form of cross-border movement restriction and disruption in the supply chain hampered the business in the market. Market players implemented multiple measures to withstand the severity of the pandemic and maintain a standard business operation in the market. The market was further affected due to stagnant growth in automotive and oil refining activities globally. The market picked up growth towards the end of 2020. Going forward, the waste oil market is projected to witness significant growth owing to the expansion of automotive and other industrial sectors globally.
Waste Oil Market Segment Analysis – By Technology
Vacuum distillation technology dominated the waste oil market in 2021. This technology allows the renewal of a wide range of waste oils into base oil with robust features of high recovery up to 85%, low cost, energy-saving, and environmentally friendly process. Owing to such a diverse portfolio, market players and research organizations are focused on the higher uses of vacuum distillation in the market. For instance, as per the April 2021 journal by the International Research Journal of Engineering and Technology (IRJET), refining of waste oil was conducted through multiple technologies out of which vacuum distillation was found out to be more effective. Such increasing use of vacuum distillation technology is expected to increase its demand in the market during the forecast period.
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Waste Oil Market Segment Analysis – By End User
The re-refiners application segment dominated the waste oil market in 2021 and is growing at a CAGR of 5.8% during the forecast period. The re-refining of waste oil in re-refiner plants helps in the removal of impurities and contaminants from the oil and to restore its original properties, making the oil ready for industrial use. The re-refined oil possesses a quality that is equivalent to or better than base oils. The demand for re-refining of waste oil is growing in the market as it supports both the atmosphere and the economy and this is expected to contribute to the market’s growth during the forecast period. For instance, as per the May 2020 journal by the International Journal of Engineering Research and Technology, re-refining of waste engine oil was carried out successfully through various steps such as dehydration and bleaching. The re-refining resulted in red transparent color base oil without the emission of any poisonous gas. Such increasing re-refining activities of waste oils in the re-refiners are projected to drive the market’s growth during the forecast period.
Waste Oil Market Segment Analysis – By Geography
The Asia-Pacific region held a significant market share in the waste oil market in 2021, up to 32%. The high demand for waste oil is attributed to the booming automobile sector in the region. Different types of waste oils such as transmission oils, hydraulic oils, and fuel oils are generated through various industrial and manufacturing processes which are later collected and refined to obtain lubricants such as engine oils and lubricating greases for use in automobiles. The automobile sector in the region is booming with increasing production and sales of vehicles and this, in turn, is projected to increase the demand for waste oil in the region during the forecast period. For instance, as per the stats by the China Association of Automobile Manufacturers, Chinese commercial vehicles production reached 310000 units in September 2021, increasing 35.5% month on month. Similarly, the passenger vehicle segment recorded a growth of 28.39% as sales of passenger vehicles clocked 279,745 units in March 2021 compared to 2,17,879 units in March 2020. Such massive growth in the region’s automobile sector is expected to bolster the demand for waste oil during the forecast period.
Waste Oil Market Drivers
Increasing re-refining application will drive the market’s growth
Re-refining of waste oil is gaining traction in the market as it restores the original properties of the oil and helps in reducing the high degree of pollution. A wide variety of waste oil such as transmission oils, fuel oils, and hydraulic oils are collected and re-refined to remove the impurities from the waste oil and substitute it with new oil. The re-refining activities are increasing in the market and this is anticipated to drive the market’s growth during the forecast period. As per the 2020 journal by IOPscience, re-refining of waste lubricating oil was conducted through solvent extraction and clay adsorption technology to produce base oil and protect the environment from pollution. Such rising activities regarding waste oil re-refining and producing base oil for use in different industries are projected to contribute to the growth of the market during the forecast period.
Booming automobile sector will drive the market’s growth
The waste oil is extensively used to produce lubricants and engine oils for vehicles in the automobile sector. The automotive sector is expanding globally with increasing production and sales of vehicles and this is projected to influence the market’s growth during the forecast period. For instance, according to the stats by India Brand Equity Foundation, passenger cars led the Indian auto market in the FY20 with a market share of 12.9% of over 20.1 million vehicles. Similarly, according to the report by the European Automobile Manufacturers Association, registrations in the passenger car segment surged in June 2021, with Germany witnessing maximum demand in the passenger car segment with a 24.5% surge. Such a massive boost in the automotive sector globally is anticipated to augment the higher use of waste oil, driving the growth of the market during the forecast period.
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Waste Oil Market Challenges
The strict regulations regarding waste oil management might hamper the market’s growth
Waste oils are hazardous waste whose management is strictly regulated by various governing bodies and this might hamper the market’s growth during the forecast period. The disposal of waste oil in landfills is closely monitored to avoid polluting the environment. As per the data by the European Commission, implements rules to ensure the correct management of waste oils to take advantage of its high recovery potential and void contaminating the environment. Such regulations regarding waste oil management might affect the market’s growth during the forecast period.
Waste Oil Market Industry Outlook
Investment in R&D activities, acquisitions, product and technology launches are key strategies adopted by players in this market. Global Waste Oil top 10 companies include:
1. Goins Waste Oil Co
2. Enfields Chemicals
3. Oil Savage Ltd
4. MIB Waste Services
5. Gecco
6. Safety-Kleen Systems, Inc.
7. Business Waste
8. Slicker Recycling Ltd
9. Oil Monster
10. J.J. Richards & Sons Pty Ltd
Recent Development
In July 2021, Safety-Kleen’s parent company Clean Harbors signed an agreement with Vertex Energy, Inc., a US-based specialty refiner company, to acquire certain assets regarding its used motor oil collection and re-refinery business.
In April 2020, Oil Monster added two new tankers to its waste oil collection portfolio. This move allowed the company to strengthen its waste oil collection system.
In May 2019, Gecco announced the installation of its new plant for transforming edible oils into biodiesel through an innovative process.
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Key Takeaways:
Vacuum distillation technology dominated the waste oil market in 2021. This technology allows the treatment of a wide variety of waste oils cost-effectively, making it a suitable option in the market.
The automobile sector is influencing the growth of the waste oil market. According to the 2021 report by European Automobile Manufacturers Association, registrations of passenger cars grew by 53.4% in the European region in May 2021 compared to the same month in 2020.
The Asia-Pacific region is expected to witness the highest demand for waste oil owing to the booming automobile sector in the region. For instance, as per the stats by the China Association of Automobile Manufacturers, the annual sales volume of Chinese new energy vehicles will reach 3 million units by 2025 which was 1.2 million units in 2019.
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