Compressor Oil for Refrigeration Market Size, Share & COVID-19 Impact Analysis, By Oil Type (Mineral, Synthetic, and Semi-synthetic), By Gas Type (Hydrochlorofluorocarbon (HCFC), Hydrofluorocarbon (HFC), Hydrofluoro-olefins (HFO), Isobutane, Ammonia, Carbon Dioxide (CO2), and Others), By Application (Refrigerated Transport, Cold Storage Warehouses, Commercial Ice Machines, Industrial Process Refrigeration, and Others) and Regional Forecast, 2023-2030

The compressor oil for refrigeration market size was valued at USD 1.54 billion in 2022 and is projected to grow from USD 1.60 billion in 2023 to USD 2.01 billion by 2030, exhibiting a CAGR of 3.3% during the forecast period. Asia Pacific dominated the compressor oil for refrigeration market with a market share of 46.1% in 2022.

Compressor oil for refrigeration is a specialized lubricating oil used in refrigeration systems to ensure the proper functioning and longevity of the compressor. The compressor plays a crucial role in the refrigeration cycle by compressing low-pressure, low-temperature refrigerant gas into high-pressure, high-temperature gas. This compressed gas is then condensed to release heat, allowing the refrigeration cycle to cool a space or maintain a low temperature. Compressor oil lubricates the moving parts of the compressor, such as pistons, cylinders, and bearings. This reduces friction, prevents wear & tear, and ensures smooth operation.

Furthermore, compressors generate heat during operation. The oil helps dissipate this heat, preventing the compressor from overheating and maintaining an optimal operating temperature. It is mainly used in commercial refrigeration, industrial refrigeration, transportation refrigeration, and air conditioning systems, thereby boosting market growth.

COVID-19 IMPACT

Disruptions in Supply Chain Affected Market Growth amid Pandemic

The compressor oil for refrigeration market growth in 2021 was slow due to the COVID-19 pandemic. The pandemic affected more than 200 countries worldwide. Restrictions on movement, lockdowns, and production slowdowns led to challenges in procuring and distributing compressor oil. This scenario resulted in supply shortages, increased lead times, and heightened uncertainty for manufacturers and consumers. Consequently, the market experienced price fluctuations, reduced product availability, and a heightened focus on building resilient supply chains to mitigate future disruptions. Furthermore, disruptions in the supply chain prompted collaborative efforts within the industry to address these challenges.

Compressor Oil for Refrigeration Market Trends

Advancements in Compressor Technology to Create New Market Opportunities

In recent years, advancements in compressor technology and formulation of compressor oils have significantly impacted the market. These innovations address critical challenges and enhance efficiency and environmental sustainability. A significant advancement in compressor technology is the development of variable-speed compressors. Traditional compressors operate at a fixed speed, leading to energy inefficiencies during periods of low demand. Variable speed compressors, however, dynamically adjust their speed based on the cooling load, optimizing energy consumption, which reduces operational costs and extends the lifespan of compressors. Another key innovation in compressor technology is the integration of Internet of Things (IoT) technology in compressor systems. Smart compressors equipped with sensors and connectivity features enable real-time monitoring and predictive maintenance. Compressor oils have evolved to support these intelligent systems by providing enhanced thermal stability and wear protection. The ability to predict potential issues before they escalate minimizes downtime and enhances overall system reliability, boosting the sales of compressor oil for refrigeration applications.

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Compressor Oil for Refrigeration Market Growth Factors

Rising Demand for Refrigeration Systems to Drive Market Growth

Urbanization, changing demographics, and an increasing focus on convenience have led to a higher demand for packaged goods. As populations concentrate on urban areas, the high demand for efficient and reliable refrigeration solutions to increase the shelf life of packaged food products will drive the need for compressor oils to maintain the operational efficiency of these refrigeration systems. Furthermore, with the growth of the global population and the corresponding rise in disposable income, there is an increased preference for processed and packaged food products. This factor contributes to expanding cold storage facilities and refrigerator transport networks. This trend is prevalent in developed countries and is gaining traction in emerging economies as they undergo economic development and witness a shift in dietary habits. This aspect will play a substantial role in propelling the demand for compressor oil for refrigeration systems.

RESTRAINING FACTORS

Environmental Regulations and Compliance to Hinder Market Growth

Many environmental regulations aim to phase out Ozone-Depleting Substances (ODS), including certain refrigerants and compressor oils for refrigeration systems. While this is a positive environmental protection step, it burdens manufacturers to reformulate their products and invest in alternative solutions. Transitioning away from ODS-compatible oils requires significant research and development efforts, impacting time and resources. In addition, the shift toward sustainable and environmentally friendly compressor oil is constrained by the limited availability of suitable feedstock. Manufacturers face challenges in sourcing raw materials that meet both the environmental criteria and performance standards. These limitations can hinder the scalability of sustainable production of compressor oil for refrigeration systems.

Compressor Oil for Refrigeration Market Segmentation Analysis

By Oil Type Analysis

Mineral Oil Gained Immense Popularity Due to Its Cost-Effectiveness

Based on type, the market is segmented into mineral, synthetic, and semi-synthetic.

The mineral segment held a major compressor oil for refrigeration market share in 2022. It is also the fastest-growing segment in the market. Mineral oils are often more cost-effective compared to their synthetic alternatives. This cost advantage makes them an attractive choice, especially in applications where budget considerations are critical, contributing to their widespread use in various refrigeration systems. Over the years, mineral oils have demonstrated reliable performance in various refrigeration systems. Their long-standing use has established a track record of effectiveness, leading to continued confidence in manufacturers and end-users, and boosting the demand for compressor oil for refrigeration systems.

In addition, synthetic compressor oils exhibit superior thermal stability, maintaining their properties at high temperatures. This is crucial in refrigeration systems where compressors operate in diverse and demanding temperature conditions. Synthetic oils resist oxidation better than mineral oils, leading to extended oil life, which will drive its demand at a faster rate than other types of oil. Furthermore, semi-synthetic compressor oils combine the benefits of mineral oils and synthetic base oils. They offer improved thermal stability, oxidation resistance, and wear protection. This enhanced performance will fuel its sales moderately at a CAGR of 3.6% during the forecast period.

By Gas Type Analysis

Hydrofluorocarbon (HFC) Segment Accounted for the Largest Share Owing to its High Energy Efficiency

Based on gas type, the market is segmented into Hydrochlorofluorocarbon (HCFC), Hydrofluorocarbon (HFC), Hydrofluoro-olefins (HFO), Isobutane, Ammonia, Carbon Dioxide (CO2), and others.

The Hydrofluorocarbon (HFC) segment held a major market share in 2022. Due to environmental concerns and regulations aimed at reducing ozone depletion and global warming, there is a global shift toward environmentally friendly refrigerants. HFCs are among the alternatives to replace chlorofluorocarbon (CFCs) due to their lower ozone depletion potential. HFC-based refrigerants are often chosen for their energy efficiency characteristics. Compressor oil formulated for HFC applications contributes to the overall energy efficiency of refrigeration systems by providing lubrication that reduces friction and enhances efficiency, boosting the segment’s growth.

In addition, HCFCs are commonly used as refrigerants in various refrigeration systems. Compressor oils formulated specifically for compatibility with HCFCs are essential to ensure optimal lubrication and system performance. However, due to HCFC’s high global warming potential, it has been phased out in many countries and is only used restrictedly. As a result, its demand will decline significantly during the forecast period.

Furthermore, isobutane exhibits favourable thermodynamic properties, enhancing the energy efficiency of refrigeration systems. The low global warming potential (GWP) of isobutane makes it an attractive choice for compressor oils, especially in light of global efforts to phase out high-GWP refrigerants that will help boost the demand for this compressor oil for refrigeration systems. Owing to its low GWP, it has become an ideal choice for domestic and light commercial refrigeration applications, driving its demand significantly till 2030.

By Application Analysis

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Cold Storage Warehouses Increased Use of Compressor Oils Due to Rapid Expansion of Cold Chain Logistics

Based on application, the market is segmented into refrigerated transport, cold storage warehouses, commercial ice machines, industrial process refrigeration, and others.

The cold storage warehouses segment accounted for the largest market share. The increasing demand for temperature-controlled storage and transportation of perishable goods, driven by rising global trade and changing consumer preferences, will fuel the growth of cold storage warehouses. This expansion necessitates using reliable compressor oils to maintain the efficiency of refrigeration systems. In particular, the food & beverage industry plays a substantial role in propelling the demand for refrigeration systems. In addition, increasing online grocery shopping, the maintenance of shelf life and quality of packaged goods, and the maintenance of the effectiveness of medicines and vaccines in the pharmaceutical and biotechnology industry are fueling the demand for cold storage facilities. As a result, it will fuel the consumption of refrigeration oil over the assessment period.

Furthermore, the transportation sector has also witnessed a growing demand for refrigeration systems, driven by the global supply chain’s expansion. The transport of temperature-sensitive goods requires refrigeration systems equipped with suitable compressor oils. The logistics industry's focus on maintaining the integrity of the cold chain has contributed to the increased adoption of advanced refrigeration technologies, thereby boosting the demand for compressor oil for refrigeration applications.

REGIONAL INSIGHTS

Regionally, the market studied across North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.

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Asia Pacific accounted for the largest share, 46.2%, of the global market for compressor oil for refrigeration in 2022 and is the fastest-growing region globally. The increasing demand for refrigeration appliances in the region, driven by urbanization, changing lifestyles, and a rise in disposable income, will directly contribute to the need for compressor oils in these systems. Ongoing industrialization and infrastructure development projects in China and India will increase refrigeration systems' deployment across various sectors, from manufacturing to logistics, thereby boosting the demand for compressor oils for refrigeration purposes.

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North America accounted for a significant market share due to increasing consumer demand for refrigeration appliances, such as refrigerators and air conditioners, which will contribute to the rising need for compressor oils to ensure efficient and reliable operation of these appliances. The continuous growth of North America's heating, ventilation, air conditioning, and refrigeration industry will fuel the demand for compressor oil for refrigeration applications as it is an essential component in maintaining the functionality and longevity of refrigeration systems.

The market for compressor oil for refrigeration in Latin America is predicted to develop significantly during the forecast period. Brazil is one of Latin America's most important economies. With the growing economies in Brazil and Argentina, there is an increasing need for efficient and cost-effective refrigeration systems, driving the demand for compressor oil in this region.

Increasing awareness and emphasis on energy efficiency have prompted industries to adopt compressor oils that enhance the overall efficiency of refrigeration systems, thereby propelling the demand for compressors in the Middle East & Africa (MEA). Due to the low presence of cold storage facilities, the MEA region will grow at a low rate compared to other regions in the foreseen period.

List of Key Companies in Compressor Oil for Refrigeration Market

Market Players Engaged in Expansion and Research & Development of Products to Maintain Dominance

Leading companies operating in Europe and North America focus on increasing their operations in different nations to maintain their dominance in the market. The key market players are also increasing their efforts to boost their regional presence, expand their distribution channels, and diversify their product portfolios.

They are also boosting their investments in various research and development programs to make high-quality products with advanced features. They are also entering strategic collaborations with other leading manufacturers to enhance their efforts in research and development. The businesses are greatly emphasizing expanding their services to boost their profits.

LIST OF KEY COMPANIES PROFILED:

• Apar Industries (India)


• Bharat Petroleum (India)


• Chevron Corporation (U.S.)


• ENEOS Corporation (Japan)


• Exxon Mobil Corporation (U.S.)


• FUCHS (Germany)


• Indian Oil Corporation Ltd (India)


• Repsol (Spain)


• Royal Dutch Shell plc (U.K.)


• TotalEnergies (France)

KEY INDUSTRY DEVELOPMENTS:

• July 2023: FUCHS Launched RENISO UltraCool 68, a universal synthetic solution for refrigeration compressors operating with NH3. This oil claims to be the ideal lubrication solution for cold compressors.


• September 2022: Indian Oil Corporation Ltd announced that it would expand its Panipat refinery capacity from 15 MMTPA to 25 MMTPA. This expansion would help the company meet the increasing demand for petroleum and petrochemical products in North India.


• June 2021: The Indian Oil Corporation Limited (IOCL) announced the expansion of the Gujarat Refinery in Vadodara by investing USD 2.89 billion in six different projects, including India’s first hydrogen dispensing station.

REPORT COVERAGE

An Infographic Representation of Compressor Oil for Refrigeration Market

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The research report provides both qualitative and quantitative insights into the market. The quantitative insights include market sizing in terms of value (USD billion) and volume (Mn USG) across each segment and region profiled in the scope of the study. Also, it provides market analysis and growth rates of segments and key countries in each region. The qualitative insights offer an elaborative analysis of key market drivers, restraints, growth opportunities, and trends. The competitive landscape section provides detailed profiling of the key players operating in the market.

Report Scope & Segmentation