Refrigeration Oil Market

The global refrigeration oil market was valued at USD 1,145.0 million in 2018 and is projected to reach USD 1,562.2 million by the end of 2025, at a CAGR of 4.64%. In terms of volume, the global market was pegged at 301.9 kilotons in 2018 and the demand is projected to reach 389.4 kilotons by the end of 2025.

The growth of the global refrigeration oil market is driven by the increasing use of refrigeration systems in the food & beverage, chemical, plastics processing, oil & gas, and medical industries. The increasing consumption of frozen and packaged food products has surged the demand for refrigeration systems to store goods at the required temperature, which is driving the demand for refrigeration oil. The expanding healthcare industry with increased spending on development of new drugs is likely to increase the requirement of refrigeration system to store drugs and vaccines and thus, drive the growth of the global refrigeration oil market. The increasing adoption of air conditioners and refrigerators in households particularly in developing countries is another important factor propelling global market growth.

Additionally, the surge in the demand for refrigerants with less and zero global warming potential (GWP) and ozone depletion potential (ODP) for automobile air conditioning systems to reduce environmental emissions is likely to drive the demand for refrigerant oils that are compatible with the new refrigerants, particularly in the developed countries and thus drive the market growth.

The development of new refrigeration oil for CO2 and ammonia refrigeration systems as a result of the increasing adoption of natural refrigerants in the refrigeration applications is the prominent trend prevailing in the global refrigeration oil market.

Moreover, the increasing demand for high-quality refrigeration oil for CO2 and ammonia refrigeration systems is projected to create lucrative opportunities for the players operating in the global refrigeration oil market in the coming years.

The global refrigeration oil market has been segmented by type, refrigerant type, and application.

Based on type, the global refrigeration oils market has been segmented into synthetic oil and mineral oil. In terms of volume, the mineral oil type segment dominated the global market with 57% share in 2018, while in terms of value, the synthetic oil type segment accounted for the largest share with market value of USD 742 million in 2018 and is expected to register a CAGR of 5.28% during the review period. The growing demand for synthetic oil is attributed to the increasing adoption of low GWP refrigerants over conventional high GWP HFCs (hydrofluorocarbons) and HCFCs (hydrochlorofluorocarbons).

The synthetic oil segment has been sub-segmented into polyol ester, polyalkylene glycol, polyalphaolefin, alkyl benzene, and polyvinyl ether. The polyalphaolefins segment accounted for the largest share in 2018 with a market value of USD 196.6 million and is expected to register a CAGR of 5.69% during the review period.

Based on refrigerant type, the global refrigeration oils market has been segmented into hydrofluorocarbon (HFCs), ammonia/CO2, and others. The ammonia/CO2 type segment accounted for the largest share in 2018 with a market value of USD 612.6 million and is expected to register the highest CAGR of 6.38% during the review period. The market growth can be attributed to the increasing adoption of natural refrigerants over conventional HFCs and HCFCs.

On the basis of application, the global refrigeration oils market has been divided into refrigerator and freezer, chillers, air-conditioners, automotive AC systems, aftermarket, and others. The refrigerators and freezer segment dominated with the largest market share of 31% in 2018. The segment was valued at USD 359.5 million in 2018 and is estimated to reach USD 488.6 million by the end of 2025 with a CAGR of 4.59% during the forecast period. The market growth can be attributed to the increasing penetration of refrigerators and freezers in both commercial and residential sectors.

By region, the global refrigeration oils market has been bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East & Africa. The Asia-Pacific market dominated the global refrigeration oils market with a share of 38.9% by value in 2018 and is expected to continue dominance during the forecast period. The regional market was valued at USD 445.4 million in 2018 and is expected to register a CAGR of 5.89% during the forecast period to reach USD 660.6 million by the end of 2025. The market growth in Asia-Pacific is driven by various factors including increasing automobile production, rising demand for air-conditioners in the residential sector, and growing food & beverage, oil & gas, chemical, and medical industries. The European refrigeration oil market accounted for second-largest share in 2018 and is expected to register a CAGR of 3.4% during the review period. The market growth in Europe and North America is primarily driven by increasing demand for natural refrigerants due to increasing F-gas regulations which has resulted in phase out of use of HFCs and HCFCs. The refrigeration oil market growth in Latin America and the Middle East & Africa is expected to be driven by rising demand for air-conditioners in the residential sector and increasing industrialization.