Market Trends of Octane Improver Fuel Additives Industry
This section covers the major market trends shaping the Octane Improver Fuel Additives Market according to our research experts:
Growing Demand for Ethanol-Blended Fuels
- Among all octane improver fuel additives, ethanol occupies a major share and is expected to grow rapidly during the forecast period.
- Ethanol has an octane rating of about 108 and is added to fuel to increase the overall octane rating of the fuel. The use of ethanol-blended fuel reduces the emission of NOX, CO, and particulate matter. Due to the lower carbon to hydrogen ratio, the use of ethanol reduces carbon-dioxide emissions and increases fuel efficiency. The use of ethanol produced from bio-based instead of petroleum-based is expected to reduce pollution and drive the market during the forecast period.
- It is found that there is a significant drop in the production of flexible fuel vehicles in 2019-20 in some parts of the United States which can run on E15, E40, and E85. However, there is a rise in demand for E15 vehicles and for the first time BMW models were approved for use of E15 and it is expecting to launch E25 by the end of 2020.
- However, due to unprecedented conditions arisen due to the COVID-19 outbreak the consumption of oil & gas is down by at least 5 million barrels per day due to lockdown in various countries resulting in the complete shutdown of travel, tourism, and e-commerce are likely to affect the consumption in 2020 and is expected to reach to normal by early 2021.
- The growing urbanization and increasing need for reducing greenhouse gas emissions are expected to drive the market for the octane improver fuel additives during the forecast period.
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Asia-Pacific Region to Dominate the Market
- The Asia-Pacific region is expected to dominate the market for octane improver fuel additive during the forecast period due to an increase in demand from countries like China, and India
- To reduce the pollution and particulate matter (PM 2.5) emissions, the Chinese government proposed guideline for the mandate adaptation of 10% ethanol-blended gasoline by the end of 2020 and by encouraging corn production, China is expecting to reach it's ethanol demand through bio-based production thereby reducing the impact on the environment.
- In early 2010, diesel was available at a discount price of about INR 25 to petrol, but now the difference is in single digits. As the price differential is reducing, the preference for petrol(gasoline)-based vehicles is expected to grow in the future.
- The Indian diesel cars sales accounted for about 19% in FYI 2019 compared to more than 50% in the year 2012, and the mandate of BS-VI engine vehicles from April-2020 made it much more difficult. India's largest automaker announced that it will discontinue the majority of its diesel car models production. While other manufacturers are expected to follow a strategic approach and will produce only high-end and heavy model diesel cars. The growing demand for petrol-based vehicles is expected to drive the market for gasoline octane improvers during the forecast period.
- The aforementioned factors, coupled with government support, are contributing to the increasing demand for octane improver fuel additives market in the Asia-Pacific during the forecast period.
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