Global Liquefied Petroleum Gas Market By Source (Associated Gas and Non-Associated Gas), Application (Industrial, Residential, Commercial and others), and Region - Market Perspective, Market Intelligence, Comprehensive Analysis, Historical Data, and Forecast for 2023-2032

Market Perspective

The global Liquefied Petroleum Gas Market size was worth around USD 120.36 billion in 2022 and is estimated to reach USD 213.94 billion by 2032 at a CAGR of 6.6% from 2023 to 2032.

Liquefied Petroleum Gas, also known as propane, is a highly attractive fuel option for businesses and individuals alike. As a hydrocarbon gas that is naturally flammable, LPG offers a number of key benefits over traditional fossil fuels. One of the biggest advantages of LPG is its clean-burning properties. Unlike traditional fuels, LPG burns with significantly fewer carbon emissions, making it a much more environmentally friendly option. Additionally, LPG is a sulfur-free and non-toxic fuel, making it much safer to handle and transport.

The cost-effectiveness and fuel efficiency of LPG, as well as its ability to control carbon emissions, has made it a popular choice for businesses and individuals looking to reduce their environmental impact. Furthermore, LPG is easy to store and transport, which has resulted in the growing demand for fuel.

The market for LPG is expected to continue growing in the coming years, with global consumption increasing by 6.4%. China (687,000 barrels) is currently the largest producer of LPG in the world, followed by the United States (630,000 barrels), Russia, India, and the United Arab Emirates.

Key Insights

• Based on the source, the non-associated segment held largest market share
• Based on application, the residential segment dominated the market share
• On the basis of region, Asia Pacific held a most significant market share

Rise in Implementation of LPG as Autogas Fuel is Propelling Market Growth

Autogas, also known as liquefied petroleum gas (LPG), is quickly becoming a popular alternative fuel for powering automobiles. As the demand for more sustainable and cost-effective options grows, the global consumption of autogas has risen by 2% in the last decade. Many developing countries are leading the way in adopting autogas, as it offers a cost-effective alternative to traditional oil-based fuels like petroleum and diesel. However, the trend of using autogas varies greatly from country to country, with some countries having well-established autogas markets.

In 2021, the overall consumption of autogas was recorded at 30.8 million tonnes, representing a growth of approximately 8% compared to 2018. The cost-effectiveness of LPG over oil-based fuels has been a key factor driving this trend.

In summary, the global market for liquefied petroleum gas is experiencing steady growth as more individuals and businesses look for sustainable and cost-effective alternatives to traditional fossil fuels. With the cost-effectiveness of LPG over oil-based fuels, it's no wonder that autogas is becoming an increasingly popular choice among countries.

The shift from Conventional Fuels Towards LPG is a Key Factor Driving Market Growth

Increasing focus on the reduction of GHG emissions saw a potential shift from fossil or oil-based fuels towards cleaner sources of power. Although LPG is extracted from natural gas wells, the combustion of LPG emits lesser amounts of carbon particles into the air. This key characteristic of the product has resulted in numerous governments promoting the use of LPG instead of conventional fuels.

The government of India through its initiatives introduced a scheme of subsidies to promote the use of LPG as feedstock for domestic, commercial, and industrial applications. Similarly, other countries have also been promoting the use of LPG to lower the use of fossil fuels and adhere to reducing carbon emissions.

Segmentation Analysis

The liquefied petroleum gas (LPG) market is driven by the increasing demand for a more cost-effective and sustainable alternative to traditional fossil fuels. Based on the source of LPG extraction, the non-associated gas segment dominates the market, accounting for over 40% of LPG extraction from natural gas wells. The cost-effectiveness of non-associated LPG, which does not require an oil refinery for processing, is a key factor driving the growth of this segment.

In terms of application, the residential sector holds the largest share of the global LPG market. The global consumption of LPG has been on the rise, with a majority of the utilization coming from the residential sector for cooking, heating, and boiling purposes. In developing economies, LPG is increasingly replacing conventional feedstock materials like charcoal, coal, wood, and others due to its cost-effectiveness.

The commercial sector is also expected to show potential growth in the liquefied petroleum gas market due to the increasing use of LPG as a vehicle fuel. In comparison to conventional fuels like petroleum and diesel, LPG is more cost-effective and has lower carbon emissions.

Recent Development

In October 2022: SHV Energy, a Dutch MNC acquired entire stakes of Petromax LPG Ltd and Petromax Cylinders ltd to expand its operational business in Bangladesh. The acquisition was valued at over USD 96.5 million.

In September 2022: National Gas Company (NGC) Energy India Private Limited was fully acquired by Petrdec. Petredec was formerly a minority shareholder in the joint venture. Petredec would be operating the business independently.

In August 2022: BW LPG, a Singapore-based company, acquired Vilma Oil’s LPG operations to further grow its division. Vilma Oil is a Madrid-based company incorporated in 2019.

In January 2021: DCC Plc acquired United Propane Gas to expand its business presence in the US. It is DCC’s biggest acquisition since the company started its operations in the US.

Asia Pacific is Dominating the Market Due to Increasing Demand for LPG

The Asia Pacific region held the largest market share in terms of production and revenue of the market. This dominance was attributed to the increasing use of LPG in the residential sector for cooking, heating water, and other purposes. Additionally, LPG is widely used as an alternate fuel in the form of auto-gas in the region. With ongoing development in various countries in the Asia Pacific region, the LPG market is expected to experience further growth. Furthermore, the industrial use of LPG is also on the rise as it is a cost-effective feedstock for the manufacturing of chemicals, plastics, and other acids.

Europe is the Fastest Growing Market Owing to Rising Usage in Non-Energy Intensive Applications

Followed by Asia Pacific, Europe has emerged as the fastest-growing region in the market. The region's cold climate has led to LPG being widely used as a feedstock for off-grid heating. In recent years, Eastern Europe has seen robust growth driven by increasing usage in the power industry.

The Middle East and Africa have also been significant contributors to the LPG market, though the size of the market in these regions is relatively small due to underdevelopment. North America has also made a substantial impact on the market, with increased production and consumption of LPG. However, the region's production decreased by 1% in 2021 due to the Covid-19 pandemic, and LPG prices have been observed at all-time highs in the last few years.

Competitive Landscape

• GAZPROM INTERNATIONAL LIMITED
• BP PLC
• Exxon Mobil Corporation
• China Petrochemical Corporation
• Bharat Petroleum Corporation Limited
• Flaga GmbH
• Saudi Arabian Oil Co.
• Chevron Corporation
• Total SE
• SHELL GLOBAL
• Abu Dhabi National Oil Company (ADNOC)

The global liquefied petroleum gas market is segmented as follows:

By Source

• Associated Gas
• Non-Associated Gas

By Application

• Industrial
• Residential
• Commercial

By Region

• North America
  • The U.S.
  • Canada
  • Mexico
• Europe
  • France
  • The UK
  • Spain
  • Germany
  • Italy
  • Nordic countries
    • Denmark
    • Finland
    • Iceland
    • Sweden
    • Norway
  • Benelux Reunion
    • Belgium
    • The Netherlands
    • Luxembourg
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • New Zealand
  • Australia
  • South Korea
  • Southeast Asia
    • Indonesia
    • Thailand
    • Malaysia
    • Singapore
    • Rest of Southeast Asia
  • Rest of Asia Pacific
• The Middle East & Africa
  • Saudi Arabia
  • UAE
  • Egypt
  • Kuwait
  • South Africa
  • Rest of the Middle East & Africa
• Latin America
  • Brazil
  • Argentina
  • Rest of Latin America